Bitfinex Debuts New Chain Split Tokens Ahead Of Ethereum Merge
- British Virgin Islands-based crypto trading platform Bitfinex has announced the launch of Ethereum (ETH) Chain Split Tokens (CSTs).
- The CSTs will allow users to trade on the upcoming highly-anticipated fork event in the Ethereum consensus protocol.
As Ethereum’s The Merge approaches, British Virgin Islands-based crypto trading platform Bitfinex has announced the launch of Ethereum (ETH) Chain Split Tokens (CSTs).
According to a recent announcement by Bitfinex operator iFinex Financial Technologies Limited, the CSTs will allow users to trade on the upcoming highly-anticipated fork event in the Ethereum consensus protocol that might lead to ETH Proof of Work (PoW) and ETH Proof of Stake (PoS) tokens.
Notably, iFinex Financial Technologies Limited will make the new CST tokens called ETHW (for PoW) and ETHS (for PoS) available in trading pairs on the derivative platforms.
“We are delighted to provide our users access to these new Ethereum Chain Split Tokens to help prepare for all eventualities as we approach the Ethereum Merge,”
The Bitfinex Derivatives Chief Technology Officer (CTO) Paolo Ardoino stated.
Moreover, the Product Manager at Bitfinex Derivatives, Jag Kooner, explained that apart from trying to provide the best experience for its customers, the company is also asking for their feedback while designing such products.
Notably, iFinex Financial Technologies Limited, which was established in September 2019, offers a derivatives service that is accessible through Bitfinex.
Bitfinex outlines three possible cases
In the announcement, Bitfinex Derivatives outlined three potential scenarios and ETHW and ETHS tokens’ roles in those situations for giving users the ability to prepare for various outcomes.
According to the company, if The Merge doesn’t result in consensus change on the current Ethereum (PoW chain), ETHS will expire, and ETH will be given in exchange for each ETHW holding. However, if the event goes successful and consensus change for the Ethereum PoS chain with no fork, ETHW will expire, and Bitfinex will provide an equivalent amount of ETH for ETHS holdings.
Moreover, users will receive their corresponding ETHW and ETHS coins if both the fork and consensus shift for Ethereum goes successful.
When a user creates CSTs using the Token Manager, ETH will be debited out of their account, and a corresponding quantity of ETHW/ETHS will be credited. Additionally, users will have the option to reverse this process at any moment by exchanging an equal amount of ETHW and ETHS for ETH. It is important to note that these CSTs will expire as the year ends, i.e., December 31, 2022.
A crypto journalist with over 3 years of experience in DeFi, NFT, metaverse, etc. Parth has worked with major media outlets in the crypto and finance world and has gained experience and expertise in crypto culture after surviving bear and bull markets over the years.
