Cryptocurrency enthusiasts are still at odds with one another after the Ethereum and Ethereum Classic split. What follows is essential information.
The name “Bitcoin” is probably the first thing that comes to mind when someone is introduced to the concept of cryptocurrency. The study of other blockchains, such as Ethereum, is almost inevitable.
However, there are a plethora of blockchains and tokens out there, and it’s easy to get lost in the shuffle. To provide just two examples, we may look at Ethereum and Ethereum Classic.
Even though they originated from the same blockchain, these two chains each have their own coin. Let’s compare Ethereum with Ethereum Classic to help you decide which one is right for you before you put any money into either.
What are the key distinctions when comparing Ethereum with Ethereum Classic?
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Originally, both Ethereum and Ethereum Classic were built on the same blockchain. Vitalik Buterin published the first version of the Ethereum whitepaper in 2013. The blockchain wasn’t made available to the general public, however, until 2015. Known as a “hard fork,” the split happened in 2016 when a hack caused the blockchain to split in two. It turns out that up to a block of 1,920,000, the two blockchains are indistinguishable.
But what really led to the rift? There was a hack at its core. The Ethereum network was the first to host a decentralized autonomous organization (DAO), yet it was also the first to be compromised by hackers.
Some members of the Ethereum community were anxious after the DAO breach. The group hoped to alter the blockchain in some way. Furthermore, they wanted to undo the attack and return stolen data to its rightful owners. However, with a public ledger, all transactions are visible to anybody who cares to look.
In response to the attack, the Ethereum blockchain underwent a hard split that allowed it to progress while also wiping any traces of the incident from existence. Those that had tokens stolen from them were compensated on the new network as part of the hard split.
The original code and a record of the hack are preserved on the Ethereum Classic blockchain. Because of this, Ethereum Classic is incompatible with the latest version of the main Ethereum blockchain, and the updates to that chain haven’t been reflected in Ethereum Classic either.
What’s the difference between Ethereum and Ethereum Classic?
Although the current main chain, Ethereum, has more users and has creator Buterin’s support, Ethereum Classic is the original Ethereum blockchain. Ethereum Classic is functionally equivalent to Ethereum in that it supports smart contracts and facilitates the creation of DApps (called apps).
You need a wallet that can store both Ethereum (ETH) and Ethereum Classic (ETC). MetaMask, Ledger, and Trezor are just a few examples of wallets that can hold both ETH and ETC. In this article, we will explain all you need to know about cryptocurrency wallets for etc mining.
However, Ethereum and Ethereum Classic are not identical. The Ethereum Classic network is fully functional and, in some circumstances, even backward compatible with the Ethereum network.
However, Ethereum is transitioning to a proof-of-stake system, whereas Ethereum Classic is still using the older proof-of-work system. To improve the network’s speed, efficiency, and scalability, Ethereum has begun implementing proof-of-stake as part of its new ETH2 blockchain. Beginning in 2020, the implementation should be completed by the end of 2022.
When it comes to who gets paid to facilitate blockchain transactions, proof-of-work is where it all started. In proof-of-work systems, validation is carried out by “miners,” who pool computing power in an effort to be the first to solve a difficult challenge.
Proof-of-stake, on the other hand, requires validators to have some kind of stake in the digital token being verified. On the whole, people agree that proof-of-stake is a more scalable and energy-efficient alternative to proof-of-work.
It’s also worth noting that Ethereum Classic doesn’t adhere to the ERC-20 token standard used by the core Ethereum network. As a de facto norm for Defi applications, ERC-20 is widely adopted as the token of choice. Wrapped ETC (WETC), however, is a tradable ERC-20 currency that operates on the Ethereum network.
Last but not least, the total number of Ethereum Classic coins will be capped. The maximum number that may be produced is 230,000,000. Ethereum’s supply has no hard limit. However, new tokens may only be created at a rate of 4.5% each year.
Comparison between Ethereum vs Ethereum Classic Costs
The gap in cost between Ethereum and Ethereum Classic is substantial. Ethereum has gained significant traction and is now regarded as the gold standard. ETH cost $3,169 on January 9, 2022, while ETC cost $30.
The highest price ever recorded for ETC was $134 in May 2021, whereas ETH reached over $4,700 in November 2021. Multiple times in 2019, the price of Ethereum Classic fell below $4, whereas the initial launch price of Ethereum (ETH) was less than $1.
Which of Ethereum and Ethereum Classic is better to invest in?
Your decision to invest in Ethereum or Ethereum Classic will be based on your specific circumstances and long-term investment plan. However, there are several things to keep in mind that might help you choose which option is the best fit for your needs.
Firstly, Ethereum is a widely used cryptocurrency, second only to Bitcoin (BTC). Ethereum has a market value of $380 billion, but Ethereum Classic only has a valuation of about $4 billion.
Ethereum’s increased accessibility and popularity also make it more liquid. Buying, selling, and trading ETH is much simpler than it was with Ethereum Classic. Despite its popularity, ETC is not traded on every platform. The Wrapped ETC complies with the ERC-20 token standard, making it suitable for usage in the Ethereum blockchain ecosystem.
It may make more sense to invest in ETH if you’re looking for something that is both liquid and readily accessible. Cryptocurrencies like ETC may appear like a preferable option for blockchain idealists who place a premium on the immutability of the ledger and the prohibition on tampering with it. Furthermore, many people see ETC as a risky investment. Gains might be much more substantial if eTCO became more widely used.
When determining which cryptocurrency token is best for your portfolio, you should take into account your individual requirements and long-term objectives.
A Guide to Buying and Selling Ethereum and Ethereum Classic
Exchanges like Coinbase, Kraken, and Binance US all stock both Ethereum and Ethereum Classic. Ethereum, however, may be purchased on Gemini, whereas Ethereum Classic cannot.
Since it has become so well-known, Ethereum can be purchased with relative ease on both traditional and alternative exchanges. Though less common, Ethereum Classic may still be obtained for buying, selling, and exchanging.
In most cases, you can purchase ETH or ETC without first acquiring another coin. It is possible to buy both tokens using conventional cash, like your bank account or a credit or debit card, on many of the marketplaces where they are listed.
There is generally the option of selling for fiat money when the time comes to cash out. Because of their high liquidity, you won’t run into many if any complications when buying or selling ETH or ETC on an exchange. Alternatively, you can use an exchange to directly trade one token for another.