What is the industry’s comment on the miners’ fork of PowETH?

After several delays, Ethereum seems to finally start the merger process in September 2022. However, with the arrival of the merger, the voices and controversies of PoWETH are getting louder and louder.

In this context, early Bitcoin evangelist Guo Hongcai (Bao Erye) established an Ethereum fork discussion group to advocate Ethereum fork, and released the Ethereum Fork Manifesto through his personal Youtube channel, advocating that the PoWETH chain after the fork should not be issued, pre-mined, or modified, and the original chain should be maintained. Bao Erye said that there may be 6 or 7 forked coins in the future, and exchanges will choose the one with the greatest consensus, and the larger the exchange, the more cautious it will be.

The PoWETH fork chain is becoming more and more intense, causing widespread heated discussion in the community.

On August 5, Ethereum founder Vitalik Buterin said at the BUIDL Asia event that centralized stablecoins such as USDT and USDC may be an important determinant of future hard forks. Vitalik Buterin added that in the next five to ten years, Ethereum may see more controversial hard forks, and centralized stablecoin issuers may become more influential decision makers.

Kaiynne, founder of Synthetix Network, commented: "Assuming that miners fork to the PoW chain, we will get two versions of everything, but a lot of DeFi on this chain will be in a weird limbo. It will continue to work in theory. But you will have powDAI backed by powETH. It would be crazy to assume that the liquidation robot runs. With the start of full liquidation, the selling pressure of powETH will be huge . Everything against USDT/USDC will be exhausted."

Hal Press, founder of North Rock Digital, analyzed that after the merger, Ethereum hard forked the PoW chain. All assets will follow the new chain, but miners can continue to maintain the old chain. However, there will be no airdrops or ERCs, and users will have 2 versions of ETH: PoSETH and PoWETH. PoSETH will become the standard, but exchanges may also list PoWETH. After the fork, there will be chaos on the PoW chain because the gap between all assets and ETH will drop to 0, which will cause a huge change in all DeFi on the PoW chain. However, this PoWETH may still have value on CEX.

Crypto KOL ryanb.eth analyzed that from a technical perspective, as long as a miner in the world does not update its client to support PoS, the PoW fork will continue to "exist" by default. However, the program + database run by a few miners cannot form a new public chain. It is just a useless, dead, private blockchain.

ryanb.eth said that a public chain is an institution - a set of relationships, culture, and consensus on top of programs and databases. Unlike ETC, PoW forks have no legitimate reason or grassroots support to exist as public chains. PoW forks are just a culturally and historically interesting and unimportant program + database. Any public chain made from a PoW fork will be destructive because it will consume energy + focus from the merged and merged eth, and more importantly, it will be based entirely on Ponzi interests and hope to dump the forked tokens. Not user-centric. No one in the Ethereum community wants PoW forks to become new public chains. Researchers, engineers, product managers, influencers, NFT artists/collectors, exchanges, protocols, and stablecoins don't want it. No one wants this thing. Based on this, any attempt to fork PoW into a new public chain should be regarded as a social attack on Ethereum.

Ethhub_io founder sassal.eth tweeted that this is the "ETH milkshake theory" . In the case of a PoW fork at the time of the merger, everyone sells their PoW tokens for PoW-ETH (at any price they can get), and then they dump this PoW-ETH for real ETH on any CEX with liquidity. As a result, ETH will rise.

Based on stablecoin considerations, in fact, two institutions including Tether have expressed support for ETH2.0.

On July 31, Tether CTO Paolo Ardoino discussed on social platforms whether USDT would support the POW Ethereum fork chain after the Ethereum merger and said, "We plan to support ETH2, and support for the merged Ethereum 2.0 will be seamless. This has nothing to do with our preference for POW or POS. Stablecoin should act responsibly and avoid interfering with users."

On August 4, Sam Kazemian, co-founder of algorithmic stablecoin Frax Finance, proposed to support FRAX redemption only on PoSETH after Ethereum switches from PoW to PoS, rather than on any PoW alternative fork (PoWETH).

As for whether the forked PowETH will become a ghost chain or a new public chain with consensus, ecology and competitiveness, we will wait and see.