Ethereum Classic

What is Ethereum Classic (ETC)?

ETC is the native coin of the Ethereum Classic blockchain. Ethereum Classic is considered among the oldest smart contract platforms. It was launched in 2015 as a legacy Ethereum blockchain and disbanded in 2016 after a dispute within the community.

The Ethereum Classic crypto network is based on the principles of “Code is the Law” and “Creating Unstoppable Applications.” It strives to maintain complete decentralization and does not change its protocol. All smart contracts running on Ethereum Classic work as they are programmed, without external interference. The current price of ETC can be seen in the chart above.

How did the Ethereum Classic hard fork happen?

Ethereum Classic is the original open-source Ethereum network developed by Vitalik Buterin and Gavin Wood back in 2015. However, the new Ethereum (ETH) network that has emerged is currently dominating the market. ETC and ETH were split in July 2016.

The precedent for separation was first set a month earlier, in June 2016, after The DAO was hacked.. The DAO was the first decentralized autonomous organization in blockchain history, hence the name.

DAO was launched in April 2016. During its creation, the platform attracted 12.7 million ETH, which at that time was valued at $150 million. This amounted to approximately 14% of the total airwaves. As a decentralized network, The DAO was open source and made its code available to community members.

In June 2016, an anonymous article was published in which a code vulnerability was discovered. Before the developers could fix the problem, hackers I used this for a few days stole 3.6 million ETH. Although the team managed to recover approximately 70% of the funds, disputes arose over how to recover the remaining amount.

One of the proposals was to return the blockchain to timestamp before the hack occurred due to a system delay that prevented the hackers from withdrawing funds for a month. However, many community members felt that a hard fork with backward compatibility was contrary to the principles of “Code is Law.”

The hard fork occurred at block number 1920000 on July 20, 2016, after much community debate and a leadership vote. The new network with the hack reversed became ETH, while ETC continued with the same blockchain history.

After the launch of the new split chain, Ethereum Classic was worth around $2. The asset has undergone many fluctuations over the years and can be considered volatile. Its value has risen sharply in 2021, with the ETC price exceeding $175 in May.

What are the main features of Ethereum Classic?

The cryptocurrency used by the Ethereum Classic ecosystem is known as Ether. Like the original Ethereum, the ETC crypto network largely adheres to the original protocol. However, after the hard fork, certain changes were made to the protocol regarding its tokenomics.

Unlike ETH, the maximum supply of Ethereum Classic coins is limited to 210,700,000 ETC, which makes the asset deflationary. This means that the price of Ethereum Classic will likely rise as supply becomes scarcer.

Ethereum Classic is mainly used for deploying new smart contracts. A key principle of the platform is that smart contracts are not modified or subject to any censorship once they are launched, to ensure the integrity of the network and comply with the principles of the Code of Law. Users can also use ETC for cryptocurrency transactions.

ETC uses Proof of Work (PoW) a consensus mechanism for mining new blocks. Miners receive transaction fees as a reward for their work. Rewards are programmed to gradually decrease over time. However, since the price of Ethereum Classic is affected by the deflationary nature of the asset, the reduction in rewards may not have much impact on the value.

How is Ethereum Classic different from Ethereum (ETH)?

The key differences between ETC and ETH lie in the ideology of the two platforms. ETC supporters believe that Ethereum abandoned the core principles of the Code is Law by initiating a hard fork after the DAO hack..

Updates that occur on the ETH blockchain after the hard fork do not apply to ETC. For example, ETC did not implement the EIP-1559 update, which introduced automatic fee distribution as well as fee burning. Moreover, while ETH plans to switch to a Proof-of-Stake (PoS) consensus algorithm, Ethereum Classic will remain PoW.

While Ethereum Classic’s comparatively low price may seem more attractive, there are several reasons why investors might prefer ETH. The story of The DAO hack left some negative connotations in this thread. He was also subject to various attacks.

Ethereum Classic has historically ranked significantly lower than ETH in terms of market capitalization. The price of ETC has generally followed the market trends that have been established by ETH as the second largest cryptocurrency in the world.