NewsletterDeFi Giant To Support Merge, Indicates Security Issues With Ethereum PoW
DeFi lending and borrowing protocol Maker on Friday announced that the Maker Protocol will continue to use the Ethereum PoS blockchain after the Merge. The DeFi giant reveals that interacting with the Maker Protocol, Dai, or MKR on any Ethereum PoW hard fork risks users to replay attacks.
MakerDAO Supports the Ethereum PoS Chain, Rejects PoW Chain
MakerDAO in a series of tweets on September 9 announces support for the Ethereum PoS blockchain after the Merge. Moreover, the DeFi giant will continue to work on the Ethereum PoS chain, and will not support any hard fork of Ethereum.
Users don’t have to change or upgrade anything to keep Maker Vault and Dai on the Ethereum PoS blockchain. The Merge is estimated to trigger on September 14 or 15. The Ethereum Mainnet (PoW) will merge with the Beacon Chain (PoS) and transition to proof-of-stake (PoS) consensus.
This will make miners obsolete and validators will process the blocks. Therefore, some miners and companies proposed an Ethereum PoW hard fork to continue mining Ethereum tokens. With EthereumPoW claiming the hard fork as inevitable, miners will mine ETHW tokens.
Maker warns that interacting with the Maker Protocol, Dai, or MKR on any Ethereum PoW fork could expose users to replay attacks. A replay attack enables a hacker to copy a transaction and run the same transaction to withdraw funds without permission. The PoS is the safe option.
“Once the Merge takes place, a forked Ethereum PoW chain appears to be imminent, with a non-zero chance that it will use the same chainId as the PoS chain.”
However, the EIP-155 was implemented to prevent replay attacks on the network. But, replay attacks could reappear if the chainId remains 1 and doesn’t change on the PoW fork. Users could lose their Dai and MKR on the PoW chain.
DeFi Platforms Turned Down Support for Ethereum PoW
DeFi platforms such as Aave, Uniswap, Lido, and others have turned down support for any Ethereum PoW hard fork. In fact, DeFi platforms have pointed out several security issues with EthereumPoW’s hard fork plan.
Meanwhile, the excitement on the Merge is pushing up prices as well as support for the PoS blockchain. The Ethereum (ETH) price soars over 6% in the last 24 hours, with the current price trading at $1694.
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