DeFi

AAVE’s Direction For ETHPoW After The Merge

AAVE's Direction For ETHPoW After The Merge

After many projects debated the future of Ethereum after The Merge event, recently Aave, the leading lending platform in this ecosystem, has also spoken out about related technical issues in the near future.

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On August 8, Aave is the next major project to speak out about the future scenarios of Ethereum. Specifically, the project’s Twitter page posted articles related to technical issues:

Notably, in the article, Aave also has statements that are said to be oriented toward a more Proof-of-Stake (PoS) future.

“From the perspective of an application layer like Aave, The Merge is just another update similar to Gray Glacier, or any other of the previous. It is true that the consensus layer changes, and this is an important paradigm change, but there is not much reason to think that a Proof-of-Work Ethereum fork would get more traction than the Proof-of-Stake, and be considered canonical.”

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And it looks like Ether’s PoW chain won’t be picked up.

“As always, Aave will only work properly on the adopted majority chain, in this case, Ethereum PoS (chainId == 1). So any potential forks should be initially ignored.”

Along with this statement, Aave also updated a few details related to the product, including that the contracts related to the liquidity pool will not be affected; the administrative voting process will be limited to a period of less than 1-3 days; technical problems in transferring funds from/to Ethereum will be closely monitored.

Additionally, Maker (the leading stablecoin and lending solution on Ethereum) also has a statement about the risks associated with derivatives arbitrage, stETH volatility, and other versions of assets that may exist after the upgrade takes place.

Founder Vitalik Buterin also gave his statements around the issue of PoW chains.

Up to now, it can be seen that early DeFi applications are gradually prioritizing the future for PoS, while most centralized exchanges are likely to support parallel PoW versions to optimize transaction volume.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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Harold

CoinCu News

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.