We will move from sha-256 to probably sha-512 or a blake algorithm

The 3rd option i believe im saying it wrong but maybe someone can correct me

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I wonder how it will work out for people who would be unaware of the move. Would they be locked out? Would they need to move to a new address with a new private key? How will seed words change?

Im no developer not sure but im guessing that aspect wont change. Also the change comes from updating your node