There is a substantial difference in the coin prices of ETH and ETC. This article explains why Ethereum Classic is so cheap compared to Ethereum(ETH).
If you are like me in crypto for a few years then you also must know Ethereum Classic. Moreover, not many crypto investors know that this is the original Ethereum chain were all initial code developments started upon.
In other words, Ethereum Classic(ETC) is very similar to Ethereum(ETH), and after the famous hard fork(DAO attack) back in 2016, both chains decided to split up. Since 2016, Ethereum(ETH) grew out to be the second largest cryptocurrency in the world and is valued at $1715,- per token in 2022.
On the other hand, there is Ethereum Classic(ETC) which remained in the shades of big brother ETH. Additionally, this crypto token is valued at roughly $36 per token at the time of writing. Even though ETC is valued 50 times less compared to ETH, this cryptocurrency isn’t going anywhere soon.
Crypto enthusiasts and investors seem to like the original blockchain network as ETC has a total market cap of roughly $5 billion. On top of that, ETC has a trading volume of about $1 trillion(!) in just 24 hours.
Therefore, if you combine all the facts and figures we must conclude that Ethereum Classic is a cryptocurrency that has to be taken very seriously. Still, why is Ethereum Classic so cheap compared to ETH?
In this article, I’ll give 4 reasons for ETC being the cheaper token. Also, my opinion is why ETC remains an interesting buy opportunity for 2022 and beyond(Not investing advice 😉).
Why Ethereum Classic?
So Ethereum Classic is valued at about 50 times worth less than Ethereum(ETH). What is the main reason behind this immense growth of Ethereum vs Ethereum Classic? Why is Ethereum Classic still a thing in 2022?
One of the main reasons why Ethereum Classic is still alive since 2016 is the fact that this coin can be mined and has a capped supply.
Particularly, Ethereum Classic(ETC) has a capped supply of 210,700,000 ETC that will ever come into existence. Every 15 seconds newly created ETC comes into existence by hardware miners.
Mining ETC with GPU miners can be profitable because the hash rate for the ETC network is quite low: 8.18 TH/s.
When it comes to hardware, the best GPUs are those high-end graphics cards that pack decent processing power for mining. Nvidia’s RTX 3090, GeForce GTX 1080, and GTX 1080 Ti are top choices. More about mining ethereum classic in 2022 here.
Reasons Why Ethereum Classic is So Cheap
Both Ethereum (ETH) and Ethereum Classic (ETC) offer a blockchain network on top of which developers can build their own applications (known as decentralized applications, or dapps, more commonly).
The majority of the code and functionality remain the same for both chains however the popularity of Ethereum has been on the rise since 2016. Here 4 reasons why Ethereum Classic is so cheap compared to ETH.
1. Ethereum Classic is the ‘old’ version of Ethereum
Ethereum Classic is the original Ethereum Blockchain and is supported by people who want the immutability of code. Once a blockchain network has been created the code shouldn’t be changed anymore or like they say “code is law”. Even after the launch of the DAO project where someone exploited DAO vulnerabilities, the necessity of a hard fork was denied.
Since the split up of both networks Ethereum and Ethereum Classic went in their own ways. Additionally, the developers of Ethereum decided to quit the limited supply of coins principle. Instead, the coins that come into existence will grow every year and is unlimited.
On the other hand, there is the Ethereum Classic that remains the hard-capped policy of 210 million ETC into existence ever. Also, the block reward for ETC will be reduced by 20% at block number 5,000,000, and another 20% every 5,000,000 blocks thereafter. This is something similar to the Bitcoin halving event that occurs once every 4 years.
2. The coins of the DAO hacker
Another potential problem or disbalance in the network of ETC is the stolen coins of the DAO hacker of 2016. To solve this hack the Ethereum community decided to split up the network and continue on the other chain leaving the hacked coins worthless.
On the Ethereum Classic chain, however, these coins remain worthwhile and can be used for daily transactions. Moreover, this DAO hacker has about 1/3 ETC of the total supply of coins. Meaning this ‘bad entity’ has a lot of power to manipulate prices on the different crypto exchanges.
The inheritance of the DAO hack is something the Ethereum Classic community has to deal with and is a potential red flag for new cryptocurrency investors.
3. Popularity of the ‘New’ Ethereum blockchain
Vitalik Buterin is one of the main founders of Ethereum and is considered the leader of this chain. Even though Ethereum Classic runs on the original code created by Vitalik and co the leader decided to move to the other chain.
Since 2016, many developments occurred on Ethereum which are initiated by him and his followers. Moreover, this Ethereum community has grown to hundreds of thousands of followers, developers, and investors.
On the other hand, there is the Ethereum Classic network that has no real leader like Vitalik Buterin with Ethereum. Buterin is very active on social media(Twitter) and also has a large following. This certainly will help grow the popularity of Ethereum even more.
As a result of this, Ethereum is the second most popular community in the world and by far much bigger than the Ethereum Classic community. Finally, one of the main reasons why Ethereum Classic is so cheap compared to ETH.
4. The security of the network
At the time of writing both Ethereum and Ethereum Classic are running the same mining algorithm(Proof of Work) to secure the network. For Ethereum, this will change later this year when it will merge to Ethereum 2.0. The long-awaited Proof-Of-Stake mechanism.
The big benefit for Ethereum will be that it can scale up the blockchain network from accordingly 30 transactions per second to 100,000 ts/sec. This is a major increase of 3300%.
Ethereum Classic has no plans in changing the Proof-of-Work mechanism(hardware miners). Additionaly, this network keeps dealing with this slow transactions throughput of roughly 30 ts/sec.
Is this also a reason why Ethereum Classic is so cheap compared to ETH? It could be.
Of course, there are pros and cons for this Ethereum merge to Proof-of-Stake and the main critics are the security and its decreasing value of it. Obviously, Ethereum and its community have decided that they think scaling up the network has more priority.
On the other hand, there will be the unchanged Ethereum Classic network still running Proof-of-Work as a consensus mechanism. Also, because of the switch of Ethereum to PoS many Ethereum hardware miners will switch to Ethereum Classic. As a result, rising demand for hardware ETC miners and a rising price for ETC(See charts below).
Ethereum Classic vs Ethereum: The Charts
Besides that Ethereum Classic is a lot cheaper to mine compared to Ethereum(ETH) there are also price developments in 2022 which are quite interesting. Moreover, in the past 3 months, Ethereum Classic gained 44% while ETH remains in the red: -33%.
Ethereum Classic vs Ethereum Charts in the past 3 months
So what is going on here with ETC? As explained above the Ethereum network will switch to Proof-of-Stake later on this year. This resulted in an outflow of ETH miners and a strongly rising demand for ETC miners. Also, the price of the ETC has been going through the roof despite the current bear-market conditions.
Finally, will ETC be a good buying opportunity for 2022 and beyond? As stated earlier the Ethereum Classic network isn’t going anywhere and will continue to grow over time. Also, it will have its unique role in the cryptocurrency market of 2022 and beyond.
However, there are still some risks you have to consider for ETC like the number of coins of the DAO hacker. All in all, it’s important to do your own research considering ETC and its community backing it.
Ethereum Classic(ETC) is established crypto and can be bought on any cryptocurrency exchange. A good option is Binance where you can sign up for free. Stay safe and happy investing!
Is Ethereum Classic Better Than Ethereum?
As stated in this article, Ethereum Classic is the original chain which the Ethereum community started working with. After the DAO hack in 2016, a chain split-up occurred where Ethereum Classic remained unchanged.
Comparing Ethereum Classic with the newer Ethereum is hard and can be based only on the total market value of both projects. Additionally, the Ethereum(ETH) project is valued almost 50x more than the original Ethereum(ETC). Based upon those metrics one can say Ethereum is better valued than Ethereum Classic.
Is Ethereum Classic worth investing in?
Both projects Ethereum(ETH) and Ethereum Classic(ETC) are established projects in the young cryptocurrency markets. Crypto in general has a lot of opportunities for investors willing to take a risk. Ethereum Classic isn’t going anywhere and can still be beneficial in the long run.
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