In recent months, the ethereum ecosystem has been among investors’ most popular topics of conversation. The upcoming merge in September has caused quite a stir, with analysts taking a close look at its repercussions on ETH to give investors an idea of what to expect. Ethereum Classic is another topic on the minds of crypto investors.
While Ethereum and Ethereum Classic aim to develop smart contracts and decentralized apps, they achieve this through different means. One significant distinction is the blockchain technology each one uses. Furthermore, they have divergent methods for conducting mining activities, changing transaction details, and limiting coin production.
What is Ethereum Classic?
The creation of Ethereum Classic happened as an offshoot of the original Ethereum blockchain platform, which was established in 2015. Although there have been modifications to the current Ethereum chain, it is still a popular choice among cryptocurrency investors.
Today, Ethereum Classic is incompatible with any Ethereum updates, including hard forks. Its ticker symbol, ETC, identifies it. Ethereum Classic focuses on a platform where users cannot alter transactions. It operates under smart contracts and produces Ether under the ETC token name.
The design of this allows users to see different trades made on the blockchain while maintaining all information anonymously. Ethereum and Ethereum Classic are two versions – one from before and one after a hard fork.
After the $50 million DAO hack, Ethereum’s blockchain technology has evolved. Unfortunately, ETC’s supporters went with the same old blockchain technology. ETH is a 2016-era fork.
The people behind Ethereum made it to help the investors that lost money in the DAO. A small group of dedicated individuals created Ethereum Classic when they refused to switch over to the upgraded version of Ethereum.
The difference between Ethereum and Ethereum Classic
There are significant differences between Ethereum and Ethereum Classic. The Ethereum platform allows prior transactions to be modified and updated. Ethereum Classic, on the other hand, utilizes the original Ethereum system that urged immutability, a procedure where users may not change transactions in blockchain history.
Ethereum Classic verifies transactions through a proof-of-work system, similar to what Bitcoin uses. Miners who verify these transactions on the blockchain receive Ether rewards.
A new proof-of-stake process has been put into place for the Ethereum system. Those who validate transactions contribute their “stakes” to the mining process. If chosen, they are rewarded with the chance to add a new block to the chain.
It is possible to generate as many tokens as needed with Ethereum. However, there is a cap of 4.5 percent yearly growth. In its existence, Ethereum Classic is restricted to 230 million tokens.
As of September 2021, Ethereum is worth $1,7o8 per token and has a market capitalization of nearly $260 billion. It is the second-largest cryptocurrency by market share. In comparison, Ethereum Classic’s market cap sits at only $5 billion, with a value of $33 per token.
Ethereum’s status as a cryptocurrency is being questioned by many, but Ethereum Classic has chosen to maintain its predecessors’ standards.
Ethereum Classic and Ethereum similarities
In as much as they have significant distinctions, they also share characteristics. Both Ethereum Classic and Ethereum are built as decentralized platforms without a single authority. They use many instances of the software or nodes to execute their blockchain.
Ethereum utilizes smart contracts to ensure the safety and security of the platform. These contracts mandate that people adhere to specific terms and conditions.
Although Ethereum Classic and Ethereum transactions cannot be altered, they operate as pseudonymous setups. The public keys on a transaction will stay open, but the person’s name and other identifying details will not appear. This design choice keeps specific details private.
The Ethereum Classic (ETC) price differs significantly from Ethereum (ETH). One of the primary reasons for the price difference is that ETC has a fixed supply, whereas ETH does not.
ETC focuses on code as law to ensure unbiased conditions for all, meaning that no authority has the right to halt blockchain processes or censor their execution. Ethereum Classic is a platform that allows for smart contracts and has the advantage of decentralized governance. This means that contracts can be carried out without needing any third party, like a lawyer or another supervisory entity.
Ethereum continues to reign supreme over Ethereum Classic regarding purchasing, selling, and creating NFTs. This doesn’t mean that ETC is doomed, but ETH will probably be the more popular and trusted blockchain in the future.
How does the Merge affect both coins?
The Merge will unite the ETH’s tenth mainnet, “Shadow Fork,” with the Beacon Chain to solve what is known as the “blockchain trilemma” of providing scalability, security, and decentralization to create a powerful, hybrid blockchain platform.
ETC was created due to the ETH fork in 2016 after the Ethereum network was hacked. The ETH blockchain was created to provide a more secure platform, and what existed then became ETC. But ETC will remain Proof-of-Work. ETC’s price soared recently in the cryptocurrency market due to the upcoming Merge.
Despite the Merge hype, ETH will still charge approximately the same gas fees, although many transactions will probably be faster and more “green.”
The Merge.ETH 2.0 will use Proof-of-Stake (PoS); therefore, current ETH miners will want to convert to ETC when the Merge is finalized. The computing equipment to “mine” ETH and ETC will be the same.
Although there is no guarantee that the ETC price will increase when the proposed Merge between ETH and ETC occurs, it is possible that the cost of both cryptocurrencies could rise as a result of the increased interest and investment in the ETH platform.