The Ethereum Merge represents one of the most significant upgrades in the history of cryptocurrency. In preparation for this event, OKX has released a comprehensive service update designed to guide users through potential changes and ensure the safety of their digital assets.
This article breaks down everything you need to know about OKX’s approach to the Merge, including key dates, trading impacts, and steps you can take to protect your holdings.
Understanding the Ethereum Merge Timeline
The Merge is the process through which the Ethereum network transitions from a Proof-of-Work (PoW) consensus mechanism to a more energy-efficient Proof-of-Stake (PoS) system. This upgrade occurs in two main phases:
- Bellatrix Upgrade: This consensus layer upgrade prepares the Beacon Chain for the Merge. It is scheduled to occur when the Beacon Chain reaches epoch height 144,896.
- Paris Upgrade: This is the execution layer transition where the mainnet merges with the Beacon Chain, officially moving Ethereum to PoS. It is triggered when the network reaches a Terminal Total Difficulty (TTD) of 58,750,000,000,000,000,000,000.
OKX will temporarily suspend ETH and ERC-20 token deposits and withdrawals during both upgrade events to ensure network stability and protect user funds.
OKX’s Preparedness Plan for the Merge
OKX has outlined a detailed protocol to handle the two most likely outcomes of the Merge, prioritizing user asset security above all else.
Scenario 1: No New Token Creation
If the Merge concludes without a new token being created, OKX will simply resume all ETH and ERC-20 token deposit, withdrawal, and cross-chain bridge services once the Ethereum mainnet is confirmed to be stable and secure.
Scenario 2: A New Forked Token is Created
In the event of a contentious hard fork that results in a new token, OKX will implement the following plan:
- The token on the Ethereum PoS chain will continue to be recognized as ETH.
- Any new token created on a potential PoW fork will be considered a forked token.
- OKX will take a snapshot of user ETH balances before the Paris upgrade.
- If the new token is created, it will be airdropped to eligible users at a 1:1 ratio based on their ETH holdings at the time of the snapshot.
- This forked token must pass OKX’s standard listing review process before it can be traded on the platform.
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Impact on OKX Trading and Financial Services
Most services will continue uninterrupted, but users should be aware of a few key details.
Trading Services
- Spot Trading: Unaffected for ETH and all ERC-20 tokens.
- Margin Trading: Trading for ETH cross and isolated margin pairs will continue. However, OKX will suspend ETH margin borrowing and VIP borrowing services temporarily. Users with outstanding ETH loans at the time of the snapshot may be required to repay them with the forked token, should one be created.
- Futures, Perpetual Swaps, and Options: ETHUSDT and ETHUSD futures, perpetual swaps, and options trading will not be affected.
Due to the potential for extreme price volatility, OKX strongly advises users to consider risk management strategies like reducing leverage, increasing margin, or closing positions in advance. The exchange may also implement additional risk controls, such as adjusting margin tiers or funding rates.
Grow Services (Earn Products)
- Savings, Staking, Dual Investment, and Smart Gain: These services will operate normally, and your invested ETH will be included in the snapshot.
- Loans: ETH loan services are unaffected. Both ETH collateral and liabilities will be included in the snapshot.
- ETH 2.0 Staking: Subscriptions will be temporarily suspended on the key upgrade dates. Staked ETH (BETH) will be included in the snapshot, but the handling depends on how a forked chain treats the ETH 2.0 contract.
- DeFi Mining: Project subscriptions are unaffected, but on-chain staking and redemption will be suspended during the upgrades, potentially causing delays.
Other Services
- Fiat Services: Deposit and withdrawal services will operate as usual.
- Convert: The token conversion service will not be impacted.
Frequently Asked Questions
What is the Ethereum Merge?
The Ethereum Merge is the long-anticipated upgrade where the Ethereum mainnet merges with its Beacon Chain, transitioning the network's consensus mechanism from Proof-of-Work (PoW) to Proof-of-Stake (PoS). This aims to drastically reduce energy consumption and set the stage for future scaling improvements.
Do I need to do anything with my ETH on OKX before the Merge?
For most users, no action is required. OKX will handle all technical aspects. However, to ensure your assets are included in any potential airdrop snapshot, it is recommended you deposit your ETH to OKX well before the event. If you are an active trader or using leverage, you should consider your risk exposure due to expected high volatility.
Will OKX support a potential Ethereum fork and its new token?
OKX will acknowledge the existence of any forked token and will credit it to users who held ETH at the time of the snapshot. However, the token must go through OKX's standard asset review process before it is listed for trading. There is no guarantee a forked token will be listed.
How will margin trading be affected?
While margin trading itself won’t be paused, borrowing additional ETH margin will be temporarily suspended. Most importantly, if you have an outstanding ETH loan during a fork, you will be required to repay that loan with the forked token, not ETH. It is highly recommended to repay any ETH loans in advance.
Are my ETH assets in earn products like Savings or Staking safe?
Yes, your assets in OKX's various earn products are safe and will be included in the snapshot for any potential airdrop. The services themselves will continue to operate normally throughout the Merge process.
What happens if the market becomes extremely volatile during the Merge?
OKX has a robust risk management system and may implement additional measures to protect users, such as adjusting margin requirements, funding rates, or price limits. Users are advised to proactively manage their own risk by reducing leverage and ensuring sufficient margin in their accounts.