Ethereum merger is imminent, what should ecosystem users pay attention to?

The much-anticipated Ethereum merger has finally entered the final countdown.

Ethereum founder Vitalik Buterin tweeted that the merger is still expected to occur around September 13-15.

As we all know, the date and time of the merger will depend on how much computer power is used to maintain the blockchain. Based on the current situation, the merger is expected to occur around 9:00 am Beijing time on September 15th.

Bobby Ong, co-founder and CEO of CoinGecko, said that the Ethereum merger is expected to take about 6 days, so many platforms and protocols will become unstable, chaotic and complicated, especially in the hours before/after the merger. The situation may be similar to the Bitcoin fork in 2017, so there may be large fluctuations.

For this reason, some Ethereum ecosystem projects issued statements/announcements in advance to warn users.

DX

Decentralized derivatives trading platform dYdX issued an announcement on September 8 stating that no disruptions to trading or withdrawals are expected during the merger.

As a precautionary measure, dYdX will pause deposit confirmations until the merge event is complete. Additionally, all exchange-related bonuses for additional DYDX tokens and Hedgies added to personal wallets will be delayed.

dYdX will monitor when it is safe to open deposit confirmations based on the finality of the “merge” block and updates from the Ethereum Foundation.

Avalanche

Avalanche stated that during the merger, assets bridged from Ethereum to Avalanche will remain bridged. No need to do anything for the merger.

However, the Avalanche Bridge Web UI will be temporarily unavailable during the merge, which is expected to occur around September 15th. This includes the bridge functionality in the Core extension.

The Bridge UI (at bridge.avax.network) will be inaccessible until the finality of Ethereum is stable enough. Hopefully it will only last for a short time, but this is beyond our control and depends on a smooth migration on the Ethereum side. The Ethereum bridge within Core will also be inaccessible during the merge, and will remain so until finality on Ethereum is stable. However, the Bitcoin bridge will remain fully functional in the Core extension.”

Avalanche also noted that after the merger, Ethereum’s confirmation requirement will change from 35 to 96, which means the time it takes for a transaction to be confirmed will increase from around 8 minutes to around 19 minutes. This change in required confirmations is due to the fact that one PoS confirmation has a completely different meaning than one PoW confirmation.

Uniswap

Uniswap recently announced that Uniswap Labs supports The Merge and has no plans to support any forks in its web application. The transition from Proof of Work (PoW) to Proof of Stake (PoS) is an important milestone in expanding the Ethereum ecosystem and immediately reducing its environmental footprint.

As a Uniswap protocol user, no action is required. The Uniswap protocol will continue to function normally during this transition period. The web application ( app.uniswap.org ) will also continue to function, but some users may experience brief unavailability if any of our third-party infrastructure providers (e.g., node providers) experience downtime.

For those building on Ethereum, Uniswap shares two PSAs to ensure the web3 ecosystem is as secure as possible:

1. Changes in the security of Uniswap v3 TWAP oracle

The Uniswap v3 oracle was designed with PoW security tradeoffs in mind, where it is foreseeably difficult for a single entity to mine multiple blocks in a row. In PoS, block producers are announced in advance for each epoch — up to 6 minutes. This “lookahead” means that the cost of manipulating two consecutive oracle values ​​can be significantly lower than in PoW. For example, a validator at block N can pay extra gas to control the last transaction in block N-1, knowing that they control the order of transactions in the next block. In the context of a time-weighted average price (TWAP) oracle, this would provide them with a window of manipulation to influence the average by changing the price to very high or very low values.

It is important to note that validators are randomly selected. However, it is also possible that a large pool of validators could be randomly selected to produce two or more blocks in a row. Given the size of some of the larger mining pools, this could happen frequently and also provide validators with the ability to manipulate the oracle price, again predictably controlling two or more blocks in a row.

We recommend considering this additional attack vector when relying on the TWAP oracle in Uniswap Protocol v3. If you are looking for a workaround, the Euler team’s Median Oracle implementation is a solid implementation worth exploring.

2. Replayability of the License

Permission is an alternative to approval — users can allow another contract to spend tokens on their behalf. Allows saving gas by skipping the approval step, allowing users to simply create an off-chain cryptographic signature that indicates their consent.

However, some permissioned implementations (including DAI, USDC, UNI, and v2 LP tokens) include a hardcoded chain ID 1 when signing permission transactions. If a chain fork occurs, the new chain ID is ignored. This creates a novel signature replay vector, allowing a permission spent on behalf of a user by a specific address to be replayed on a forked chain.

For example, a license signed for the Uniswap router on ETH can be used for the same router, deployed on the same address on ETHPoW. This is not a risk, because the Uniswap router cannot transfer any funds from your wallet without an additional authorization transaction. However, if a malicious contract is deployed on ETHPoW to the same address, it can reuse the license signed by ETH to transfer funds on ETHPoW without the user's permission.

As always, we recommend only signing permissions for contracts you trust. If you are participating in ETHPoW, additional due diligence is recommended.

X2Y2

On September 6, the decentralized NFT trading market X2Y2 stated on the social platform that for the upcoming Ethereum merger, X2Y2 will suspend the market's smart contracts 15 minutes in advance. On the forked ETHW, X2Y2's smart contracts will be suspended forever. The market will be restarted shortly after the successful Ethereum merger.

Optimism

On September 7, Layer2 solution Optimism published a statement saying that Optimism’s researchers and engineers are lifelong Ethereans, some of whom have directly contributed to Merge. Once Merge is launched, Optimism’s operations will be completely transferred to the PoS chain, and assets on Optimism will only be withdrawn to the PoS chain.

Optimism says the merger will not affect the Optimism network. This means there is no downtime, no changes to the network, and deposits and withdrawals continue to work as usual. Optimism's transaction data and state root will be published to the Ethereum PoS chain. Nodes will not be affected as they continue to read data from the merged chain. Reducing Ethereum's energy consumption by about 99.95% is the result of a lot of effort and coordination. Optimism is already looking forward to the next stage in improving Ethereum's scalability and sustainability in its Rollup-centric roadmap - EIP-4844, which will further reduce Rollup fees by up to about 100 times.

The Sandbox

On September 8, the Metaverse platform The Sandbox released a statement on the social media platform saying that it will only support the Ethereum POS chain and does not intend to support any potential ETHPoW forks. Any tokens assimilated with The Sandbox on the potential ETH PoW fork have no value.

Token ($SAND, LAND and NFT) holders do not need to take any specific action. To ensure the security of user assets, users are not recommended to interact with any ETH PoW fork.

As a precaution, all major Ethereum functionality on The Sandbox (markets, bridges, claims, minting) will be disabled around the time of this merge. A further announcement will be made to specify the exact downtime. Staking functionality on Polygon will remain available without interruption.

OpenSea

On September 1, NFT trading platform OpenSea announced that it will only support NFTs on the upgraded Ethereum PoS chain. As for the forked NFTs that exist on ETHPoW - they will not be supported or reflected on OpenSea. In addition to the commitment to support the upgraded PoS chain, we have been preparing OpenSea products to ensure a smooth transition.

Axie Infinity & Ronin Network

On September 6, Ronin Network and Axie Infinity announced that they will support ETH PoS after the Ethereum merger. To ensure the integrity of the Ronin bridge, the team will suspend it 24 hours before the network merge and reopen it after verifying support for the merge. Axie Infinity mentioned that if users want to try to obtain a possible fork of ETH PoW, they need to withdraw their Ronin WETH to Ethereum before the Ronin bridge is suspended.

Synthetix

On September 2, the decentralized synthetic asset protocol Synthetix officially announced that it would suspend most functions of the protocol, including synthetic trading platforms, futures, loans, pledges (claims, minting, destruction) and bridges, when the terminal total difficulty (TTD) reaches 5874000000000000000000, about 3 hours before the Ethereum merger. SNX Tokens can still be transferred. Synthetix will resume activities after ensuring the stability of Chainlink price feeds and the rest of the protocol.

FTX

On September 5, according to the official announcement, in preparation for the upcoming ETH merger, FTX will suspend ETH deposits and withdrawals on Arbitrum One, Solana, and Binance Smart Chain at the following time points, and will reopen deposits and withdrawals after the merger is completed and the network is stable:

Arbitrum One ETH: 00:00, September 7, 2022 (UTC)

Solana (Wormhole) ETH: 2022-09-15 00:00 (UTC)

Binance Smart Chain (BSC) ETH: 00:00, September 15, 2022 (UTC)

Please note that FTX reserves the right to update the above timeline at any time.

BendDAO

On September 7, the NFT mortgage lending protocol BendDAO announced that it would suspend ETH deposits, withdrawals, loans, repayments, and auctions 3 hours before the Ethereum mainnet merger. All functions will be re-enabled and work normally on PoS Ethereum shortly after the merger.

In addition, BendDAO stated that BendDAO smart contracts will also work normally on PoW Ethereum. Users can process their PoW assets on PoW Ethereum, including withdrawing ETHW after the merger.