Binance Is Not Ruling Out Support for Ethereum Proof-of-Work Fork

Binance, the world’s biggest cryptocurrency exchange by volume, said today that it would not rule out support for Ethereum’s upcoming controversial fork, ETHPoW. 

The exchange announced it would support “the merge”—a protocol change expected to take place on or around September 19, which completes Ethereum’s long-awaited upgrade to a proof-of-stake consensus mechanism. That much was expected.

But the company also added that it would possibly support the “merge resistors” who plan to continue to use proof of work and create a spinoff network and cryptocurrency. “In case of new forked tokens, Binance will evaluate the support for distribution and withdrawal of the forked tokens,” its Wednesday statement read. 

“In order to protect Binance users, all forked tokens will go through the same strict listing review process as Binance does for any other coin/token,” the company added.

In September, the Ethereum network will upgrade to ETH 2.0. Instead of being a proof-of-work blockchain, it will be proof-of-stake, which will eliminate the need for miners. 

Validators and not miners will keep the network secure by locking up the network’s crypto. The change is expected to make Ethereum faster, more scalable, and much more energy efficient. Proponents of the shift also say the upgrade will help to keep inflation in check for the network’s native crypto, ETH.

But the end of Ethereum proof of work will undoubtedly have a negative impact on the network’s miners who rely on mining rewards as a source of income.

Earlier this month, Chinese crypto miner Chandler Guo announced he wanted to resist the upgrade and keep a proof-of-work version of Ethereum alive in a bid to help the miners who may be left stranded after the upgrade. 

He plans to go forward with what is called a hard fork: when those working on the network no longer agree on the best way forward and therefore go separate ways—with a new cryptocurrency. 

In this case, the network would be known as ETHPoW and the new coin would be ETHW. Ethereum developers, however, remain skeptical that such a venture would gain significant developer and market support. But big market players have since signaled that they’d be open to it.

So far, major exchanges like Justin Sun’s Poloniex, and Huobi, have said they will support the fork by listing the token. And BitMEX said Monday it would launch a futures contract for ETHW. 

Meanwhile, Circle, the company behind the second biggest stablecoin, USDC, said it would only support ETH 2.0. 

Tether, the biggest stablecoin provider, also explicitly announced it would back the merge, adding that it was “important that the transition to POS is not weaponized to cause confusion and harm within the ecosystem.”