After The Merge, having multiple split versions of blockchain Ethereum (called forked chain) appears will surely cause confusion for investors NFT, leading to the risk of unfortunate property loss. This article will help readers understand the impact of The Merge on NFT in particular and the types of assets in general are being stored on blockchain Ethereum, and also outlined some notes that investors can apply to better protect their assets after this important event.
The Merge, Forked Chain and NFT
The Merge is the event that the sequence Proof-of-Work (PoW) of Ethereum will be merged into Proof-of-Stake (PoS) chain and in the immediate future, this event will help reduce the amount of ETH released (due to validator rewards in PoS chain is lower than miner in PoW chain because PoW chain consumes more energy of miner to aggregate transactions).
After this process has taken place, NFTs and other user assets will still exist on the new chain of Ethereum (PoS chain) and will still appear in their wallets.
In the event that the Ethereum community disagrees on this upgrade, a chain split will occur (i.e. one chain will still follow the same PoW mechanism – one recent emerging example is ETHPOW, and the other chain. will follow the new PoS mechanism).
Thus, the user's NFTs (if purchased before The Merge) will simultaneously appear on both chains, and these two versions of NFTs will simultaneously point to a file that stores image and content information. , sound ... that users still see as before.
If an NFT exchange simultaneously supports both PoW and PoS chains, confusion is bound to happen. New users who do not know the difference between main chains and split PoW chains can buy NFTs on the PoW chain at a very high price while the new “original” version is the NFTs on the PoS chain.
The risk of a replay-attack has been mentioned when two PoW and PoS chains have the same chain ID.
A replay attack is an attack in which a transaction made on the PoW chain is copied and replayed on the PoS chain. For example, when an owner sells a copy of NFT on the PoW chain, the buyer will make a transaction to deposit the same NFT into their wallet on the PoS chain, causing the owner to actually lose the original on the chain. new.
Replay attacks ️
How would a replay attack work?
If you send 100 ETHPoW on the POW chain from your wallet to a friend, then your friend could broadcast the same transaction in the POS chain and send yourself 100 original ETH to his same wallet
This is dangerous
— olimpio.lens ⚡️ (@OlimpioCrypto) August 11, 2022
However, as noted above, this attack is only possible when the two new chains ETHPOW and Ethereum use the same chain ID. In fact, Ethereum developer Marius Van Der Wijden and ETHPOW co-founder Chandler Guo confirmed that the two chains will use different identifiers, so the possibility of a replay attack has happens almost to zero.
But this is only the confirmation of a chain splitting project after The Merge. Many other split chains, besides ETHPOW, will most likely be born after The Merge, and it is not clear if they will use a different chain ID code. If so, the risk from these replay attacks is still possible.
Note to investors
Until now, the largest NFTs exchange in Ethereum is OpenSea confirmed that it will only support the Ethereum PoS chain, so users will not need to do any extra work on switching between chains when using OpenSea again.
In case any NFT exchange claims to support both chains, the best way to prevent replay attacks is to not interact on the PoW chain (which has the same chain ID as the Ethereum PoS blockchain).
If you still want to "play" with the Ethereum PoW blockchain, users can protect themselves in the following ways:
– Quickly use up all the nonces on the PoS chain before making more transactions on the PoW chain (because then the transactions on the PoW chain will use the same nonces as the nonces we used on the original PoS chain. earlier). By doing so, the hacker will not be able to copy the transactions from the PoW chain to the PoS chain because the number of nonces has been used up by us.
– On the PoS chain, transfer all assets from the current wallet to a new wallet. Hackers will not be able to copy transactions from the PoW chain to the PoS chain because the old wallet address on the PoS chain is no longer an asset.
– Make transactions on the PoW chain with an extremely low gas fee, so low that the transaction copied by hackers to the new PoS chain will be blocked because there is not enough gas (the gas fee on the PoW chain will be much lower than the PoS chain). because the need to use the PoS chain – which is the official Ethereum blockchain – is greater)