Recently updated on October 25th, 2022 at 11:00 am
Ethereum is a decentralized blockchain platform that makes a peer-to-peer network that runs and safely checks application code. These contracts for apps are called “smart contracts.” People can do business with each other using smart contracts, so there’s no need for a trusted central authority. You can’t change transaction records, but you can look at them, and they are safe because they are spread out across the network. For more details visit this website.
This means that everyone has complete control over the transaction data and knows everything there is to know about it. On Ethereum, people with accounts can send and receive transactions. Ether, the Bitcoin network currency, is used to sign transactions and pay fees.
Plans have been in the works for a while to switch the Ethereum network from proof-of-work (PoW) to proof-of-stake (PoS) (PoS). Still, the people who work on Ethereum have decided that the new date for integration will be September.
Let’s look at three options available to traders and investors.
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1. Keep your Ether to get the “hardfork” token you want.
The first plan is easy to understand. Traders only have to buy Ethereum (ETH) on the spot market, store it in their exchange wallet or any other platform or wallet that supports forked tokens, and wait for the expected proof-of-work token to be issued.
When Bitcoin split into Bitcoin Cash in 2017, every Bitcoin owner got the same amount of Bitcoin Cash, which at one point was worth $1,650 per token. This is what we call the “fork.” BCH reached its all-time high of $800 in 2021 when the bull market was at its strongest.
The best place to sell PoW tokens from businesses that chose to ignore the Merge would be on exchanges that let hard forks happen. You can search online for exchanges that support hard forks. Don’t forget to pay your taxes on time if you have to in your country.
2. You should sell futures and buy Ethereum
Let’s say you’re not sure if Ethereum will be able to finish the Merge without any major problems. A good number of people agree. And after this hellish year, in which Bitcoin (BTC) gave up all of its yearly gains, Wonderland Money fell apart, and Terra (LUNA), now Terra Classic (LUNC), Celsius, and Three Arrows Capital beat everyone, it is natural to worry about a fundamental change in the market’s second largest asset.
Investors can spread their risk if they aren’t sure how they feel about the Merge. In a nutshell, you would need to be long Ether, which many people are and have been for a long time, or at least since the price hit a “bottom” of $880 not too long ago.
If you have a long position in Ether and a short position in futures or options contracts, you can protect yourself from losses if the price of ETH drops a lot. If you’re lucky, you’ll also get the PoW hard fork tokens, which should more than compensate for losses on the spot. Visit Virtual currencies if you want to trade or invest in cryptocurrencies.
3. Keep your position with stablecoins, and pay attention to trading with the trend
Some investors might not care much about getting the “free” PoW hardfork tokens because the risk of trying to trade Merge is higher than the possible gain.
If you think this way, it shouldn’t be too hard to come up with and follow a plan that considers the expected volatility if you’re in stables. If these traders believe in digital currencies, they might buy ETH after the price has gone down. If there were a lot of different PoW tokens being traded on exchanges, price changes in hardfork tokens could also be used.
The only person to blame for what this article says is the person who wrote it. They don’t always show what Cointelegraph.com thinks. Before making a choice, you should always do your own research because every investment or trade comes with some risk.
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