Ethereum VS Ethereum Classic

Updated by Loren Oller verified symbol on July 12, 2022

Even though Bitcoin is still the most popular blockchain-powered digital currency, Ether has been tailing it as the second most dominant cryptocurrency, turning many investors' heads for years. The story of Ethereum and Ethereum Classic starts with a hard fork. This detailed guide will explain why the fork happened and how the two cryptocurrencies are different nowadays. Moreover, we'll examine the main similarities and differences between ETH and ETC and discuss whether they are advisable investments.

What Is Ethereum Classic?

Ethereum Classic is the previous version of Ethereum that continued to work as a separate cryptocurrency after the fork. Like Ethereum, it's open-source crypto based on blockchain technology and runs smart contracts. Developers can create decentralized applications and other tokens using the Ethereum platform and offer users an option to invest in those tokens via coin offerings.

Technically speaking, Ethereum Classic (which uses ETC as the ticker symbol) works the same as Ethereum. Still, it's an older and less popular version, so from a financial perspective, there are considerable differences which we'll explore later. But first, let us take a quick overview of why Ethereum diverged from Ethereum Classic

Ethereum Classic History

Many newcomers may not realize that new cryptocurrencies are constantly created, and some of them use an existing network to "fork" from the leading crypto. In other words, they're using almost the same underlying code, but there are subtle differences that make it stand out from the original. The most famous example is when Bitcoin Cash (BCH) forked from Bitcoin, offering faster transactions and several other improvements.

The history of the Ethereum Classic starts on June 17, 2016, when the fork took place. Unlike the Bitcoin/Bitcoin Cash fork, which happened because the community was divided ideologically, the Ethereum fork was necessary. Namely, in June 2016, a hack took place, and around $50 million worth of funds in ETH were gone. The team behind Ethereum, led by Vitalik Buterin, decided to fork the cryptocurrency and return the state of records before the hack to return the stolen assets to the owners. Therefore, they created an entirely new cryptocurrency called Ethereum, and they named the old one Ethereum Classic.

Ethereum Classic continues to live a life of its own, and you can exchange it for other cryptocurrencies like Ripple on many exchange platforms. However, it's not the main focus, so its market cap and the overall price are much lower than Ethereum, and that's perhaps the main difference when it comes to ETC versus ETH.

What Is a Smart Contract?

Apart from cryptocurrencies and NFTs, smart contracts are probably the third most-hyped thing in the crypto space.

A smart contract is a program used on the blockchain. A coder can determine the conditions on which the smart contract will be executed, effectively eliminating the need for a middleman. In other words, if both sides agree on a smart contract, it will be completed only if both sides do their part of the agreement as stated. Since smart contracts are on the blockchain network, they are also secure and immutable, much like cryptocurrencies.

Perhaps the most famous example of smart contract use is buying an apartment. Imagine that two people are engaged in an apartment's buying/selling process. Traditionally, they would have to hire a person who would be the intermediary and do all the paperwork. A smart contract would make the entire process easier, transferring the ownership from the seller to the buyer only after the transaction has been completed successfully. Apart from making the whole process easier, smart contracts also increase the overall security and trustworthiness.

Ethereum's creators popularized the idea of doing business on a decentralized platform using a smart contract. Before that, blockchains were mainly used for cryptocurrencies, while Ethereum expanded the use of decentralized ledgers to other business practices. Nowadays, Ethereum serves as a platform for creating decentralized apps (dapps) with smart contracts embedded in them. 

Ethereum Classic Price Prediction

Let's start with the following fact: Ethereum Classic is a cryptocurrency, and that piece of information means it's highly volatile, much like many other cryptocurrencies, so making the exact price prediction might be a difficult task. Because of the volatility, the prices go up and down all the time.

However, it's safe to say that its current position is much more unfavourable than Ethereum's. Almost every analysis on the Internet made in finance articles written by experts suggests that Ethereum Classic won't make it to the mainstream simply because it's overshadowed by its younger sibling we know as Ethereum.

Is Ethereum Classic a Good Investment?

At the moment, Ethereum Classic only serves to preserve the state of the Ethereum chain in the condition it was before the fork took place. Therefore, not many people are interested in investing in ETC in the first place. Apart from being less popular than Ethereum, Ethereum Classic is a frequent target of 51% of attacks. A hacker tries to manipulate ETC every once in a while, which means you'll face certain risks by investing in it. 

Therefore, ETH is a safer and better option if you consider investing. There's a vast community working tirelessly on improving it, and almost every popular project and token is based on the Ethereum platform. Right now, there are thousands of products using Ethereum, making ETH the main competitor to Bitcoin.

Face to face eth vs eth classic

Ethereum vs Ethereum Classic

All things related to the underlying code of Ethereum and Ethereum Classic were identical. After the fork, the two cryptos paved their own paths, although both still follow the same basic principles of blockchain technology, such as privacy, anonymity, immutability, transparency, and more. But how exactly are the two coins different at the moment?

First of all, let's look at them from the perspective of utility. Both Ethereum and Ethereum Classic allow making smart contracts, dapps, and more. But, more importantly, you can create other tokens and even an entire ecosystem surrounding your project. Also, most NFT creators use Ethereum as the platform of choice to launch their non-fungible tokens.

As for Ethereum Classic, the community virtually doesn't even exist. Nobody interested in creating dapps would choose the classic version over the standard Ethereum. Simply put, that's where the party is, keeping Ethereum the top platform for working on blockchain-based projects.

From a payment method perspective, it's also safe to say that Ethereum has a huge advantage. The two cryptocurrencies have a similar throughput (transaction speed), around 12 to 15 transactions per second, and the gas fees are pretty similar. However, Vitalik and his team have been working hard on introducing Ethereum 2.0, which will have many improvements and changes from the Proof-of-Work (PoW) consensus mechanism to a more environmentally-friendly Proof-of-Stake. This endeavour will improve the transaction speed and scalability and result in many other benefits, further separating ETC from ETH. 

Ethereum Classic and ETH Similarity

So far, we have mainly discussed how the two cryptocurrencies are different, but let's not forget that they are the two closest cryptos in terms of functionality. So here's a short overview:

  • Both Ethereum and Ethereum Classic let you build decentralized applications and use smart contracts.
  • Both are based on blockchain technology and follow the same principles and rules.
  • There are no maximum limits to how many cryptocurrencies can be in circulation, meaning new coins can be minted at set times (as opposed to Bitcoin and many other cryptos, where a total limit is set). 
  • Both use Proof-of-Work as a consensus system, although that will change soon.
  • Both are available for trading on popular exchanges, although Ethereum is present on more platforms than Ether Classic. 

Mining Ethereum vs Ethereum Classic

We have already mentioned the Proof-of-Work consensus protocol upon which both cryptocurrencies are based. This is identical to Bitcoin's mechanism, requiring miners to keep it going. Therefore, to mine ETH or ETC, you need to have the right equipment and install the right software.

As a miner, you'll keep the network decentralized, approve transactions, and get rewarded for your contribution to the network. At the moment, there are many more miners who are part of Ethereum, making it highly decentralized. On the other hand, the miner network is much smaller for ETC, which means it's susceptible to a cyber attack.

In short, both have a similar mining process, but it is currently much better to mine ETH, as it's much more popular and gives you more chances at making profits as a miner.

Everything we've said so far will not be true soon because of the Ethereum 2.0 upgrade mentioned earlier. This upgrade will change how mining works, as the Proof-of-Stake (PoS) consensus requires staking ETH to act as a node and keep the system decentralized. It means you won't need costly hardware to be part of the network. This approach is much better for the environment, given that Proof-of-Work currently consumes more energy than the entire country of Argentina.

Future of ETC

The future of Ethereum Classic looks bleak, as there's little room for growth from both financial and technological perspectives. Simply put, nobody chooses Ethereum Classic for any serious project, and its popularity has been declining lately. 

It doesn't mean ETC will go away, as anything could happen in the crypto world, which is still very young and volatile. Put differently, there's always a possibility that the team working on ETC will develop improvements that will enhance its security and make it more attractive for investors. However, it will probably never overtake ETH, which is likely to remain the most popular altcoin for a long time. 

Investing or not in ethereum classic

Should I Invest in Ethereum Classic?

At this moment, Ethereum Classic doesn't seem like the best cryptocurrency to invest in. However, if you're interested in entering the cryptocurrency market, the most obvious choice would be Ethereum. And that's because a more robust organization is behind it, tirelessly developing the project.

So, should you avoid investing in Ethereum Classic altogether? If you have some extra money and want to diversify your portfolio further, you can buy some ETC, but most of your investment amount should go to ETH. Of course, nothing is 100% certain in the crypto world, as stated in the section above. After all, you never know if ETC might turn out well in the future. However, that's the risk you must be willing to take and understand it's much more significant than investing in ETH. 

Final Thoughts

Hopefully, you now see why there's an ongoing discussion about Ethereum Classic vs Ethereum. Here are some of the highlight points of this guide:

  • While Ethereum Classic is all about keeping the original state of the network alive, Ethereum is all about the future. Some of the most brilliant minds contribute to it and keep developing innovative ideas on how to improve it further.
  • Ethereum is much more popular than Ethereum Classic.
  • At this moment, both cryptocurrencies have similar transaction times and fees.
  • Both versions use the Proof-of-Work mechanism, although Ethereum will switch to Proof-of-Stake in the future. 
  • More investors are interested in ETH than ETC since ETH is the most popular altcoin.
  • ETC has been subject to 51% attacks several times and is much less decentralized than ETH.

Ethereum Classic vs. Ethereum: which is faster?

Both cryptocurrencies are similar in transaction speed, but it is expected that Ethereum will become much faster after the introduction of Ethereum 2.0.

What coins use Ethereum vs. Ethereum Classic?

The majority of tokens you come upon nowadays are the so-called ERC-20 tokens (or ERC-721 for NFTs), meaning they are built on the Ethereum platform. There aren't many tokens using Ethereum Classic.

Ethereum Classic vs. Ethereum: Which is better?

Ethereum is the better option now, as its value is much higher than its older version. Moreover, it will likely remain that way in the future.

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Loren Oller
Loren Oller verified symbol Author
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I consider myself to be an avid guitar player, sports enthusiast, and a big fan of blackjack and social casinos. My task is pretty easy to resume.. make sure you are well informed on all US casinos that might interest you. I've been writing reviews based on my experiences for a while and I'm happy to say that my work will truly help you even if it's just by telling you the legal gambling laws of a state or the top games that are trending right now!
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