Ethereum Classic: The “firstborn” is catching up with his “little brother”!

In 2016, classic blockchain platform Ethereum forked, resulting in an altcoin with a capitalization of around $3.2 billion as of late January.

The Ethereum Classic cryptocurrency was created as a result of the hard fork of the Ethereum core network on July 20, 2016. These platforms are similar in many ways, but also have major differences.

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On June 17, 2016, a hacker attacked the DAO project’s investment fund and stole about 3.6 million Ethereum cryptocurrencies from it, which at the time was worth about $60 million ($88,000,000 at the end of 22nd December exchange rate). January) accounted for. To recoup the losses, the Ethereum Foundation proposed changing the cryptocurrency blockchain.

Part of the community was extremely opposed to such a method, as it could negatively impact the decentralized nature of the system and its security. The hard fork violated several principles of digital money, so cryptocurrency co-founders Charles Hoskinson and Gavin Wood suggested continuing to work on the legacy blockchain. Vitalik Buterin rejected the idea.

The hard fork took place on July 20, 2016 on the 192,000 block and all Ethereum holders received a similar number of new coins. Ethereum Classic was backed by MinerGate, a major mining pool, and two weeks after the chain forked, the altcoin was added by trading platform Poloniex, followed by Bitfinex, Kraken.

However, the new cryptocurrency also had opponents – Chinese entrepreneur Chandler Guo promised to carry out a 51% attack on the altcoin network, but did not receive the necessary support, so it did not happen. In August 2016, the Ethereum Classic community released a “Declaration of Independence” that spelled out the altcoin’s key principles:

  • Preservation of the blockchain in its original form.
  • Impossibility to change cryptocurrency code and keep it safe and decentralized.
  • The platform is open to anyone who agrees with these principles.

After that, the developers held an Ethereum Classic hard fork to optimize the code and defer the “complexity bomb” — an update that would make mining the cryptocurrency unprofitable. In early 2017, the altcoin blockchain was updated to reduce the load on the network, followed by several other improvements aimed at increasing the security of the network.

Where to trade and how to store

Ethereum Classic cryptocurrency is traded on most major exchanges such as Coinbase, Binance, Bithumb, and others. At the end of January 2022, the altcoin’s daily trading volume is $288 million. For comparison: Ethereum is at $11 billion.

Ledger Nano S and Trezor hardware wallets can be used for long-term safekeeping of the asset. For quick access to your coins, the dedicated online wallet Ethereum Classic, available at this link, is a good choice. You can use Jaxx, Parity, Mist and other options to work from mobile devices.

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Ethereum Classic is an open-source platform for decentralized applications based on the Proof-of-Work algorithm. It runs with the Sputnik Virtual Machine. Initially, altcoin issuance was not capped, but in December 2017 it was capped at 210 million tokens, of which almost 133 million have been mined so far.

Like Ethereum, it uses the Gas token for internal transactions, which protects the network from spam and determines the commission distributed to miners. In 2018, the first Callisto Network sidechain project was implemented and all ETC holders received a similar number of CLO tokens. At the moment, its price is $0.005.

The cryptocurrency network is developing, it has an active community. However, the platform is criticized for the instability of the network, the use of the blockchain, which was successfully attacked by a hacker. Experts estimate the cost of conducting a 51% attack on the altcoin network at $55 million.

differences

Ethereum Classic cryptocurrency is based on the Ethereum blockchain, so there are not many differences between the two – both smart contract platforms are designed for decentralized applications. One of the biggest differences is that the second most capitalized cryptocurrency has no spending limit.

According to Emercoin’s CTO, the ETC project lacks the personality of Vitalik Buterin to attract large investments. The specialist emphasized that Ethereum was clearly ahead in terms of PR, marketing, number of partnerships and implemented projects, so the “classic” was catching up.

However, it is more decentralized, because in order to make changes to the code of the second largest cryptocurrency, a proposal must be made, which is then discussed by the developers.

At the same time, thousands of ICOs and many decentralized applications are launched on the blockchain of Vitalik Buterin’s platform, Ethereum Classic cannot boast of such statistics.

Classic Ethereum article and permission to publish here provided by Jamie Martinez. Originally written for Supply Chain Game Changer and published on February 2nd, 2022.

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