ETHW forked for 72 hours: market value plummeted and miners left

ETHW's opening was eclipsed.

By Kyle

More than 72 hours have passed since the birth of ETHW (Ethereum Pow). During this period, the ETHW network was in constant turmoil. First, it used the same chain ID as the SmartBCH test network, causing network connectivity problems; Later, the security agency pointed out that ETHW suffered replay attacks and lost 200 ETHW tokens.

In the secondary trading market, the ETHW token generated from the original ETH 1:1 mapping fell all the way after a short rise. As of September 19, the asset price fell to about $5, more than 80% lower than the peak on the day of launch.

The continuous decline in asset prices reflects the decline of coin holders in their development prospects, and ETHW, whose slogan is to safeguard the interests of PoW miners, is also being abandoned by miners.

2miners data shows that the computing power of ETHW's main network reached 80.56 TH/s on the day of its launch. By September 19, this value had dropped to 29.92TH/s, a drop of 62.8% compared with the peak, accounting for only 3.89% of the total computing power of 769 TH/s before the Ethereum main network merger.

The market value plummeted, and the miners left, revealing their embarrassment 72 hours after ETHW split.

After the listing of ETHW, the price went down all the way

On September 15, Ethereum completed the merger and upgrading, and the consensus mechanism was changed from PoW (proof of workload) to PoS (proof of equity). For the past seven years, PoW miners have been responsible for the block packaging and verification of Ethereum network, and have received rich block rewards and commission rewards. After the merger, the Ethereum under the PoW mechanism officially withdrew from the historical stage, but the mining machine and computing power of the original miners did not disappear.

Under the banner of "safeguarding the interests of miners", Guo Hongcai (Second Master Bao), the KOL of the early domestic currency circle, and Sun Yuchen, the founder of Bochang, as community leaders, opened the chapter of the forked Ethereum. According to the plan, 24 hours after the merger of Ethereum, the branch network ETHW (Ethereum Pow), which continues to maintain the PoW consensus mechanism, will be formally deployed, and then the chain ID of ETHW will be switched. In order to reserve sufficient time, the ETHW main network will be online at the specified time after 2048 empty blocks have been processed.

However, a small episode occurred during the launch of ETHW's main network.

On September 16, many users found that they were still unable to access their blockchain using ETHW's officially published home network information, and could not connect to their network using the encrypted wallet. Later, SmartBCH pointed out that the network connection problem of ETHW may be due to the use of the same chain ID as the SmartBCH test network.

This problem was subsequently fixed. The ETHW main network went online, and some of the original Ethereum miners switched their computing power to the ETHW network, with the maximum computing power of the whole network reaching 80.56 TH/s.

At the same time, as the branch network of Ethereum, ETHW also issues token airdrops 1:1 to all ETH holders. At present, Ouyi OKX, FTX, Bitfinex and other trading platforms have been launched on the ETHW trading market.

According to the rule of blockchain forking in the past, the price trend of the forked chain token after its launch reflects the consensus foundation behind it to some extent. On the OKX platform, ETHW opened at a price of $15, and once rose to $27.99 after going online, which is far from the price of about $1600 before Ethereum forked. In contrast, ETH maintained its previous price for a period of time after the merger.

After a short surge, the ETHW price fell rapidly, and the closing price fell to $12.08, 56.8% lower than the highest point. In the following days, ETHW continued its downward trend. On September 19, ETHW fell as low as $3.88, and then rebounded to about $5.15, down 81.6% from the peak on the day of launch.

Analysts believe that ETHW fell sharply in just four days, mainly due to the selling of the holders who obtained the token airdrop. According to the data of Ouke Cloud Chain ETHW browser on September 19, after the main network went online, the network handled more than 9.56 billion ETHW transactions. According to its price trend, most users chose to sell after receiving the air drop.

Sharp decrease in computing power indicates that the miners are leaving

The market sell-off of ETHW reflects that users are not optimistic about the prospect of this forked network, especially on September 18, when a security alarm intensified the concern of the outside world about its security.

According to the monitoring of the security agency BlockSec, an attacker has carried out a replay attack on the ETHW chain. Replay attacks usually occur after the blockchain network forks. Since the addresses and private keys on the two chains are the same, and the transaction formats are identical, the transactions on one chain are also completely "legal" on the other chain. Transactions initiated on one chain will also be confirmed if they are replayed on another chain.

During the fork preparation period, ETHW team performed replay protection at the code level, requiring that all transactions must be signed with the chain ID. However, some people still found loopholes. According to the analysis, the attacker first transferred 200 WETH to the ETH network through the Omni cross link bridge of the Gnosis chain, and then replayed the same message on the PoW chain to obtain an additional 200 ETHW.

This attack makes users question ETHW's technical capability and security. Subsequently, ETHW officially announced that it had tried to contact Omni Bridge and told the bridge that it needed to correctly verify the actual chain ID of the cross chain message. ETHW emphasized that "this is not a chain level transaction replay, but a call data replay due to the defects of specific contracts."

Whether the same Chain ID as that of the SmartBCH test network is used during the primary network, or the replay attack occurs, the forked ETHW appears insecure. If these problems are small technical problems that can be solved quickly, then the collapse of people's minds is very powerful for ETHW.

After the ETHW main network goes online, it includes F2Pool, Pool and BTC Many mining pools, including www. ehw. com, have announced their support for ETHW's mining. ETHW community has also cooperated to launch a backup mining pool, Ethwmine, which is committed to providing long-term mining pool services for ETHW.

These ore pools serving miners hope to continue to earn revenue from the miners transferred to ETHW. However, the computing power of ETHW network is rapidly lost in just a few days.

According to the data of 2miners on September 19, ETHW's total network computing power is 29.92TH/s, which is 62.8% lower than the peak value of 80.56 TH/s after the main network went online. According to the assumption before the bifurcation, ETHW will have the opportunity to undertake the computing power of most of the original Ethereum networks, but its current computing power level only accounts for 3.89% of the total computing power of 769 TH/s before the merger of the Ethereum main network.

In contrast, ETC, RVN, ERGO and other networks using the same mining algorithm have seen a significant increase in computing power, especially ETC has once increased from 50 TH/s before the merger to more than 200 TH/s, which indicates that ETHW is not the only choice of the original Ethereum miners.

ETHW network computing power has experienced a significant loss

As the ETHW price continues to fall, more and more miners find this bifurcated chain unprofitable, so it is not surprising that the computing power drops sharply. In the context of the weak consensus foundation, ETHW's most dependent miners are gradually leaving, which casts a cloud over the future of this forked chain.

In the consensus of the encryption industry, the value of the new generation of public chain depends on the construction of the ecosystem on the chain. The more prosperous the ecosystem on the chain is, the more active the activities on the chain are, and often the value of the public chain is more recognized. Before the ETH merger, a number of mainstream DeFi applications and stable currency issuers, such as Uniswap, OpenSea, the USDT issuer Tether, and the USDC issuer Circle, said that they did not support any branching chain, which directly led to ETHW's inability to inherit the original Ethereum mainstream applications on the chain. In other words, the current ecology of ETHW chain is very weak.

According to the data of Ouke Cloud Chain, on September 19, the number of active addresses on the ETHW chain was only 27100, a decrease of 226400 compared with the previous day, which indicates that the enthusiasm of users on the chain to participate in ETHW has decreased significantly. In contrast, the number of active addresses of ETH network in the same period is 487700, and the number of active addresses of BNB Chain is 1426800.

The market value of contemporary currency has plummeted, miners and users have left, and the ecological construction on the chain almost needs to start from scratch. ETHW's opening has been eclipsed. How to stand in the new husband chain will become its biggest challenge.