Ethereum Classic is a decentralized, public blockchain-based platform that runs smart contracts and decentralized applications. It’s essentially an open source project similar to Ethereum, but with different guiding principles and objectives.
This digital currency was launched in 2016 after the Ethereum network suffered a major attack and split into two. Ethereum Classic was created as a fork of the original Ethereum network and has been evolving since its creation.
Keep on reading to learn about Ethereum Classic, including its origins, and some of the key differences between Ethereum Classic (ETC) and Ethereum (ETH).
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Ethereum Classic vs Ethereum
In 2016, a group of early Ethereum enthusiasts devised an ingenious plan to create a decentralized autonomous organization (DAO), which would allow users to pool their Ethereum coins and collectively decide on projects. It was simply called The DAO, and it raised approximately $150 million’s worth of ETH.
However, a vulnerability in its code allowed an attacker to withdraw $50 million of funds.
This resulted in a division in the community about how—or rather, if at all—the immutable code behind the ethereum blockchain should be revised.
Crypto conservatives believed that changing anything in response to this one incident would set an bad precedent about how decentralized applications are meant to function without centralized interference or oversight.
Some believe that tampering with a blockchain can’t be done without causing major disruptions to the network behind it.
Others, however, recognized such an event as inevitable, and wanted to amend their code to prevent attacks like this from being repeated. This group took the initiative and started up a new chain after retrieving the stolen funds, keeping the name Ethereum – the one we know and probably some coins of today.
The rest of the community – a group of fervent “code is law” believers – stuck with the original Ethereum blockchain, and eventually changed their name to Ethereum Classic (ETC).
When old isn’t always good
While Classic is implementing some smaller improvements, it will not transition to an energy efficient and scaling-friendly proof of stake network model. This means that the future apps developed on this platform may become obsolete in a few years as opposed to being able to scale with demand like those built on Ethereum’s upcoming 2.0 upgrade.
Additionally, ETC lacks the support, security and vision that has made ETH a leading player in the crypto market. It fell victim to multiple attacks this past year which could compromise its network’s integrity, putting all users at risk of attack or theft.
As history has shown, this can only be remedied by a hard fork (i.e. creating another new cryptocurrency), which will undoubtedly be met with criticism from some supporters.
One important implication is that there is a difference between the two cryptocurrencies’ scalability models.
ETH allows for fast transaction speeds, something that ETC lacks. Due to the recent developments, Ethereum 2.0 will be able to process 10,000 transactions per second which is greater than Classic’s capabilities by several orders of magnitude.
How to buy ETC
If you want to get your hands on some ETC, you can use a crypto exchange to either purchase it with fiat currency, or exchange your existing cryptocurrency.
When choosing an exchange, it’s important to account for the following factors:
- The geographical location and restrictions (Is it available in your country?)
- Transaction fees (How much commission will they charge to buy and sell your crypto?)
- Security, anonymity, and support (What happens when something goes wrong? Can you talk to a human being?)
- UI and ease of use (You’re not a professional trader, so is it easy to use)
- Volume and liquidity (Do they have enough of your desired cryptocurrency for long-term trading?
We have personally used and recommend two exchanges, depending on your geographical location: [affiliate_id=”kraken”] and Coinbase. They tick all the boxes, and they’re internationally trusted.
When you purchase your ETC, you can leave it in a wallet on the exchange. However, most people recommend withdrawing it to a wallet that you directly control. Even the most trustworthy exchanges are at risk of being hacked.
Set up your own wallet in an app like Trust Wallet, then withdraw your Ethereum Classic there for safekeeping.
Future of Ethereum Classic
Although both networks share similarities at first glance- namely that they’re cut from similar cloth – when you take into account recent history it becomes apparent that these two blockchains might be following very divergent paths going forward.
Price jumps for Ethereum Classic have been the result of speculative fever, according to CoinDesk’s article coverage on this topic. The recent price jumps are attributed specifically by one analyst as due to “FOMO” and other speculation-related causes such as hype from new investors or fear among holders.
Yet while Ethereum has continued to grow in popularity with more apps on its network becoming available for use, a growing number of people are joining the fight against what is known as “Ethereum’s centralized nature” by moving over to ETC.
Some view ETH as the new silver to bitcoin’s gold; others see the fork as the ultimate death blow to the well-known cryptocurrency. However, it’s important to keep in mind that ETH is still a work in progress and, if it works as planned, its ecosystem is bound to grow.