Another crypto company plans to suspend ETH transactions before the Ethereum Merge.
Aave, decentralized finance (DeFi) protocol that allows to borrow or lend cryptocurrencies, has offered to temporarily suspend Ether (ETH) transactions ahead of the Merge.
According to the research team Block Analitica, the main issue that may arise during the Ethereum Merge is a high ETH utilization due to Ethereum Proof-of-work (PoW) hard fork.
Did you know?
Want to get smarter & wealthier with crypto?
Subscribe – We publish new crypto explainer videos every week!
The research team highlights that if it happens, then liquidations may be impossible to complete, and annual percentage yields (APYs) may drop to negative numbers.
Therefore, Block Analitica suggests that pausing the borrowing and lending of ETH will minimize the risks of utilization.
Following the proposal, the Aave community decided to open up a Snapshot vote for each member to submit their vote. The voting will be open from August 30th to September 2nd.
The community members can choose from four answers:
Yes (temporarily pause ETH borrowing) and pay 60 AAVE tokens; yes (temporarily pause ETH borrowing) and decide on payment later. The community can revisit the proposed payment later, but that should not block the community from taking action (pause ETH borrowing) to derisk Aave in the interim; no (do not pause ETH borrowing); abstain.
It is worth mentioning that the first stage of Ethereum Merge is scheduled for September 6th, followed by the final stage, between September 10th and 20th.
Other crypto-related companies have also taken safety measures before the Ethereum Merge. On August 16th, crypto exchange Coinbase announced its plans to postpone Ether (ETH) and ERC-20 token withdrawals and deposits during the Ethereum Merge. On top of that, the company has launched its new asset, called Coinbase Wrapped Staked ETH (cbETH), which will replace the previous version of Coinbase’s staked Ether (ETH2).
On August 25th, crypto exchange Binance announced that it is planning to halt Ether (ETH) and ERC-20 token transactions.