Gate.io EVP on The Merge: Supporting crypto community’s needs is a top priority
As The Merge nears, talks about a proposed Ethereum hard fork have swirled around the crypto space. Although there are varying opinions around the outcome or purpose of an Ethereum fork, one thing holds true: asset security and support for community decisions should be a top priority.
For those not caught up, The Merge is an upcoming upgrade to the Ethereum mainnet. Expected to happen sometime between September 15th and 16th, it will lead to the end of the proof-of-work (PoW) consensus mechanism in favour of proof-of-stake (PoS). As a result, miners will eventually no longer earn income post-merge, replaced by validators earning from the PoS mechanism.
PoW miners taking a different route
As a result of The Merge, various Ethereum miners have proposed a hard fork. In essence, a hard fork is when a blockchain’s protocol changes and an incompatible alternative chain is created. For example, in the case of The Merge, miners could reject the upgrade and continue supporting the pre-merge mining-friendly version of Ethereum. Meanwhile, validators will continue to support the upgraded Ethereum.
Currently, there are a few proposals for a forked PoW-based Ethereum, with one example, EthereumPoW gaining some traction. None of these Ethereum forks have yet launched, but they may do so if The Merge happens. However, several exchanges have preemptively listed tradable IOUs under ETHS, ETHW, and ETHPoW tickers. Essentially, these IOU assets act as a placeholder in case a hard fork emerges.
How are exchanges tackling The Merge?
One of the exchanges that listed ETHW in early August was Gate.io, allowing users to purchase and trade ETHW before The Merge and potential fork.
“We are committed to supporting all voices in the Ethereum community and developments in the broader blockchain ecosystem. Regardless of the path that anyone chooses, Gate.io will support and protect their choice,” said Tom Yang, EVP at Gate.io, “We expect The Merge to happen with high probability. Potential hard forks have also gained traction, and we’re providing solutions in advance for both scenarios so all parties can choose with confidence.”
Gate.io opened spot trading on two IOU assets related to a potential fork, ETHS and ETHW. ETHS will be converted to regular ETH based on balance snapshots immediately before the upgrade if a fork happens. At the same time, ETHW will represent the forked PoW chain that has the largest hashrate. If a fork does not occur, ETHS and ETHW can be converted back to ETH at a 1:1 ratio.
“It’s important to facilitate an environment for traders to make their own choices,” said Tom, “We’ve put in place safeguards for traders. Users’ assets will be safe regardless of the outcome. One of our primary goals at Gate.io is user asset security without compromising users’ crypto experience throughout our platform ecosystem. Whether it be our trading tools, decentralized and Web3 products, or in this case avenues that support the decisions of the Ethereum community, user protection is front and centre.”
A safe path not bound by one outcome
No matter the outcome of The Merge, Gate.io’s preemptive PoS and PoW implementations allow users to choose their path confidently. Gate.io remains supportive of the community’s decisions and making a choice now will not result in lost opportunity or assets.
The countdown to The Merge is ticking. While nothing is certain, the scenario for a successful and on-time upgrade feels more likely than ever. Whether the chain is forked or not, Ethereum will become less energy-intensive and more efficient. In the end, the world’s second-largest blockchain will continue down its path to addressing core blockchain problems like scalability, transaction cost, and speed in later planned upgrades.