Coinbase to Halt Ethereum ERC-20 Deposits & Withdrawals During The Merge
Coinbase product manager Armin Rezaiean-Asel announced in a blog post that the exchange will halt ETH and ERC-20 deposits and withdrawals during the Ethereum Merge.
It’s not the first time that Coinbase Is temporarily suspending deposits and withdrawals. Taking precautionary measures to protect users and the system is Coinbase’s standard practice for any major network upgrade.
Coinbase Wants Safety During the Merge
A similar move happened again the year after the hard fork of Bitcoin split further into subsequent blockchains. In 2017, the exchange paused activity during the chain split between Bitcoin and Bitcoin Cash.
“Although the Merge is expected to be seamless from a user perspective, this downtime allows us to ensure that the transition has been successfully reflected by our systems,” said Rezaiean-Asel, “We do not expect any other networks or currencies to be impacted and expect no impact to trading for ETH and ERC-20 tokens across our centralized trading products.”
Besides that, the exchange said that users should be cautious when any individuals ask them to send ETH to upgrade to ETH2. ETH2 tokens don’t exist and any offerings are fraudulent. Crypto users need to take no action to get staked ETH.
Not a Total Freeze
Users are still able to trade, buy, and sell on Coinbase with existing assets as ETH and ERC-20 token swaps are still accessible.
The crypto exchange, however, has not provided any further details on the specific date of pause. Users may pay attention to its official channels for updates before the long-awaited Merge which is slated to showcase around September 15 or 16.
Speaking with Decrypt, a Coinbase representative said that the exchange planned to halt deposits and withdrawals for only, “a short period of time,” and there would be likely no specifics until “the start of the Merge.”
It remains uncertain whether other crypto exchanges such as FTX, Crypto.com, and Gemini will pursue the same move.
As Decrypt reported, an email sent on behalf of Binance confirmed that the exchange will also follow a similar move of halting ETH and ERC-20 token deposits and withdrawals and will provide notice to its users soon.
The Merge is Coming Soon
Information suggests that the Merge will happen on September 15 or 16.
There is currently a lot of hype and speculation around the Merge. Crypto analysts also pointed out a potential scenario of traders buying the rumor and selling the news when the upgrade approaches.
However, Coinbase’s precautionary measures could affect traders’ positions and the price of Ethereum if the halting extends.
After the Ethereum network changes from PoW to PoS, many people think that ETH’s energy use will drop quickly,
it will be easier to scale, and it will be harder to hack. But ETH gas fees might not go down right away, and transactions might not happen much faster than before.
A little over a month ago, the crypto market has been in green, and most of the excitement is set on Ethereum. In fact, the cryptocurrency is in a good spot right now because of the next update, which is happening in a few weeks.
This eagerly-awaited Merge has driven up the price of Ether, which is now over $2,000; this rise also affects the whole crypto market, which is also going up because investors are excited and have high hopes.
But traders should be cautious as this may be a simple bounce back during a bear market.
The next few weeks will be very important for the entire cryptocurrency market, and September seems like it will be a real earthquake for the ecosystem because of the Merge, which will change the Ethereum blockchain from a Proof of Work system to a Proof of Stake system.
The merge is expected to have a significant impact on the ecosystem, and will make crypto history.