Coinbase Preps for the Merge, Warns Users of Interruptions
Ether and ERC-20 token deposits and withdrawals will be paused during the Merge
Source: DALL·E
key takeaways
- Coinbase Wallet expected to experience minimal, if any, impact
- ETH2 will be locked until the Ethereum protocol upgrade completes
Coinbase will briefly pause new ether (ETH) and ERC-20 token deposits and withdrawals as a precautionary measure during the Merge, which has a rough target date of Sept. 15.
Armin Rezaiean-Asel, product manager at Coinbase, outlined what users can expect from the company ahead of the Merge, in a Tuesday blog post. He said the planned “downtime” will permit the platform to verify a successful transition from proof-of-work (PoW) to proof-of-stake (PoS) on the Ethereum mainnet.
“Your assets will be safe and secure during this period and no action is required to upgrade on your part.”
As for staked ETH, the company advises users to be on high alert for scams and warns against sending ETH to anyone in an attempt to “upgrade to ETH2.” Coinbase allows its users to stake their ETH via the company’s Beacon Chain validators, which currently hold 14.7% of all staked ether, according to Dune Analytics.
Ether staked with Coinbase will remain listed within a user’s Ethereum wallet on the platform, but will remain locked after the Merge — as it is today — until the Ethereum protocol’s Shanghai upgrade is completed in 2023.
Users of different Coinbase products will be impacted differently.
Coinbase Wallet users with ETH and ERC-20 balances, as well as non-fungible tokens (NFTs) or decentralized finance (DeFi) positions on the Ethereum network, are expected to experience minimal to no impact.
Coinbase Prime users, on the other hand, may experience temporary delays in custody withdrawal availability of their ETH and ERC-20 balances.
Coinbase Cloud users should expect a routine upgrade with approximately 10 minutes of downtime in advance of the Merge. Additionally, the ability to process new payments will be temporarily paused during the Merge for Coinbase Commerce customers.
Other cryptoassets are not expected to be impacted across Coinbase’s trading products, added Rezaiean-Asel.
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