Ethereum Hardfork – Constantinople

in #ethereum5 years ago


Cryptominando

As most of you would have heard, there is an upcoming hardfork taking place on the Ethereum ($ETH) network.

Previous well known hardforks include the ETH-ETC split, the BTC-BCH split and the BCH-BTCABC-BTCSV split. These were contentious forks and came about due to disagreement in the communities within them. The results were separate chains and additional tokens of these chains issued to holders of the original token. These forks existed because there were disagreements about how these blockchains should operate, disagreements on rules, which if changed would not be able to be applied retroactively, meaning that a new chain would be created.

The Ethereum Constantinople Hardfork is different, no disagreement exists. This is simply a network upgrade as a part of the transition from PoW to PoS. The upgrade consists of 5 EIP (Ethereum improvement proposals) ranging from optimisation to changes in $ETH economic policy. The upgrade is set to occur on block 7,080,000 estimated on the 16th January 2019. The most significant aspect of the Constantinople upgrade is EIP 1234 in which the block reward is reduced from 3 $ETH to 2 $ETH. This is due to the delay of the 'difficulty bomb' set for the transition to PoS. The other EIP's include EIP 145/1052 - Improves network efficiency (EVM), EIP 1283 - Reduces gas consumption of smart contracts and EIP 1014 - State channels upgrade/'Off-chain transactions' (Scaling).

So far Binance, KuCoin, Bitforex, OKex, Huobi and Bibox have all confirmed they will be supporting this fork. I expect every exchange to be in support if this fork as it unequivocally improves the Ethereum blockchain. The easiest way to prepare for this fork is to deposit your $ETH onto an exchange that does support the fork. The exchange will handle all the heavy lifting and issue you the new hard fork tokens.

The price behaviour surrounding this fork came as somewhat of a shock. Our market is in a state of flux. We seem to be emerging from a bearish phase in which price did not respond at all to positive fundamental news. We are not yet in a phase where the market efficiently responds to fundamental news, as most positive fundamental news events have no effect on price. We are somewhere between bearish inefficiency and efficiency. In an efficient market we would buy the rumour and sell the news, this tactic has proven somewhat unreliable over the past 12 months so we are in a period of pattern rediscovery.

Looking to scalp fundamental news is risky in the current environment and I prefer to enter trades with more certainty based on patterns that are well established. In saying that, I do see this as a strong reason to accumulate $ETH for the long term hodl, however, this should not be done during a run up, wait for a retrace.


***I also shared this article on TRYBE***

This is not financial advice. I don’t take into account of your personal investment objectives, specific investment goals, specific needs or financial situation and makes no representation and assumes no liability to the accuracy or completeness of the information provided here. The information and publications are not intended to be and do not constitute financial advice, investment advice, trading advice or any other advice or recommendation. Any expression of opinion (which may be subject to change without notice) is personal to the author and the author makes no guarantee of any sort regarding accuracy or completeness of any information or analysis supplied.

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