Decentralized finance (DeFi) lending protocol DeFi MakerDAO announced at will continue to use the Ethereum PoS blockchain after The Merge. In other words, anyone who decides to use a blockchain from a hard fork will not be supported by the protocol. This membership is very relevant because according to the DeFi Pulse website, MakerDAO is the largest DeFi protocol in terms of allocated value. Without your support, any eventual division of the network will have a blockchain that will not have many DeFi features. MakerDAO cited security issues as justification for its decision. In a series of tweets, the protocol said that interacting with DAI or MKR tokens on any Ethereum hard fork risks users suffering replay attacks. In this attack, a malicious actor intercepts and then repeats a valid data transmission that passes over a network. With this, hackers can use the hard fork to steal tokens they do not have the right to.
MakerDAO rejects hard fork support
This Friday (9), MakerDAO announced its full support for The Merge, noting that DeFi services will only work on Ethereum (ETH). Users do not need to change or update anything to keep Maker Vault and its DAI on Ethereum. The Merge is estimated to take place between the 13th or 15th of September. On this date, the main Ethereum network will merge with the Beacon Chain, the layer that has Proof of Stake (PoS) mining. When that happens, Ethereum mining will cease to exist. However, The Merge will make miners obsolete as validators will process blocks from implementation. Therefore, some miners and companies have proposed a hard fork to continue mining tokens, EthereumPoW (ETHW). Maker warns that interacting with Maker Protocol, Dai or MKR on any Ethereum PoW fork can expose users to replay attacks. A replay attack allows a hacker to copy a transaction and execute the same transaction to withdraw funds without permission. PoS is the safe option. “Once the merge takes place, the occurrence of a network split appears to be imminent, with a non-zero chance of using the same chainId as the PoS-enabled blockchain,” Maker said. On Ethereum, EIP-155 in theory can prevent replay attacks on the network. But if the chainId remains 1 and doesn’t change in an eventual hard fork, users may lose their Dai and MKR in the new chain. Therefore, MakerDAO chose not to support networking.
DeFi Platforms Declined Support for ETHW
MakerDAO is not the first DeFi protocol to reject operations with an Ethereum hard fork. Networks like Aave, Uniswap, Lido and others have also refused support for any hard forks. In all cases, the platforms raised security issues. Meanwhile, Ethereum Classic (ETC) has gained traction among miners looking to stay in the market as the token will keep mining via Proof of Work (PoW). The price of ETC has already gained 15.73% in the last seven days, while Ether (ETH) has seen a rise of 5.35% in the same period. Read also: Analyst says time to buy Cardano is now, before hard fork Read also: White House pushes for zero carbon emissions after latest crypto mining report of Brazilians who traded cryptocurrencies
