Ethereum Classic is a cryptocurrency born out of a hard fork from the original Ethereum (ETH).
The ETC has been around since July 2016, and it has seen an increasing number of exchanges list it, while its market cap surpassed $1 billion in February 2017.
Our goal with this guide is to provide you with all the information you need about the ETC to make an informed decision on whether or not to invest your time and money into it. We hope that by reading through our guide, you will come away feeling confident about investing in Ethereum Classic.
How does Ethereum Classic work? What is its purpose?
At its core, ETC is a decentralized platform on which other applications can be built. In addition to that, it aims to fix some of the issues that were found in the original Ethereum through its hard fork in July 2016 that happened after the DAO attack. The main idea behind ETC was to return stolen funds during this attack and fix various issues within the ETH platform. The ETC is intended to work as a currency that applications can use on the Ethereum Classic platform.
They are carefully verified by nodes (more specifically miners) who use Proof-of-Work (PoW), similar to ETH when it comes to transactions. However, instead of using the Ethash PoW algorithm, ETC uses a different PoW called the Cuckoo Cycle PoW. The main reason for this is that many believe it’s more efficient and will lead to less centralization in mining pools.
However, ETC has stated that they are planning to switch away from the Cuckoo Cycle algorithm in the future. The main reason behind this is that it is not ASIC-resistant, which could lead to more centralization of mining pools over time.
How to Buy ETC
To buy ETC, you need to first know how to buy Ethereum or Bitcoin, as these are the currencies that you’ll be using to purchase ETC.
You should also have a digital wallet so that your coins don’t get lost. There are many different types of wallets like hardware wallets, mobile wallets, and paper wallets.
Once you have a wallet, it’s time to purchase some Ethereum or Bitcoin using your credit/debit card or bank account through an exchange like Coinbase or Gemini. You can then send these coins over to Binance to trade them for the ETC cryptocurrency.
Once you have the ETC in your possession, it’s time to move them into your Ethereum Classic wallet.
History of Ethereum Classic (ETC)
Ethereum Classic was first created due to the DAO attack, and it followed the original path set out by the Ethereum Foundation. However, just before the hard fork happened, some major players rejected this plan and continued using the old blockchain. The most famous of these individuals is Barry Silbert, who backed this project early on and is currently its biggest proponent.
The hard fork created the new Ethereum while the old blockchain continued to exist under the name of Ethereum Classic (ETC) and maintained its original immutability aspect.
Many of the major players in the Ethereum community-backed this project, including Charles Hoskinson, one of the main architects behind ETC. They all believed that it’s better to stay true to the value proposition of blockchain, which includes immutability while also fixing some of the issues present within the ETH platform.
Since the hard fork, Ethereum Classic has been fully supported by its community of users, investors, and developers. It also received plenty of developer support from IOHK, which Charles Hoskinson himself leads.
At the end of March 2018, ETC became a very popular currency after climbing up to the number 5 spot on Coinmarketcap.
Final Thoughts on Investing in the Ethereum Classic (ETC)
Investing in the Ethereum Classic (ETC) is a great idea if you want to diversify your portfolio. With its growing popularity, ETC could make for an excellent addition to any crypto-investors portfolio because it provides stability while also maintaining some of ETH’s original values like immutability and decentralization with the Cuckoo Cycle PoW algorithm.
Ethereum Classic (ETC) FAQ
What is a fork?
A fork happens when a blockchain diverges into two separate versions. Forks are typically done to add new features to the original chain or reverse transactions (such as during the DAO attack on Ethereum).
What’s the difference between ETC and ETH?
Both of these currencies work in the same way (i.e., the blockchain is shared between nodes), and they use many of the same technologies behind them. However, there are a few key differences, such as their monetary policy and hashing algorithm. ETC uses the Memory Hard Equihash Proof-of-Work (PoW) algorithm, whereas ETH uses Ethash, which Vitalik Buterin created. The former uses a higher inflation rate (2.83%), while the latter has zero inflation after all the coins are mined.
What’s the difference between the account abstraction layer and sidechains?
The account abstraction layer is a core change to the Ethereum code that makes it easier for developers to create dapps. Sidechains are separate blockchains that link to the main chain and allow assets from one system to be securely used in another.
How many confirmations does ETC need?
ETC only needs six confirmations to consider a transaction as valid. These typically happen within 6-8 minutes which is much faster than other currencies such as BTC and ETH.
What’s the difference between Proof of Work (PoW) and Proof of Stake (PoS)?
Proof of work requires miners to use computational power to solve difficult problems and add a new block of transactions into the blockchain. In contrast, Proof of Stake is when nodes take turns proposing and voting on the next block which they think should be added to the chain.
Is Ethereum Classic worth mining?
It’s worth noting that ETC has a lot more mining support than ETH, which means it usually proves to be much easier to find blocks and get ether rewards.