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what is the difference between ethereum vs ethereum classic

Ethereum vs Ethereum Classic - The Difference Between The Two

Last Updated: August 4, 2022
Are you wondering what the difference is between ethereum vs ethereum classic? The story behind the two is actually a little complicated because they used to be one and the same. Casual crypto investors probably only know a little bit about Ethereum and nothing about Ethereum Classic. What if I tell you Ethereum Classic was, in fact, the more original chain between the two? If you are surprised about this fact, let’s learn a little bit further.

This article analyzes both Ethereum and Ethereum Classic and compares them against each other.

Main Differences

There are two big differences between the two. First of all, Ethereum Classic (ETC) has a fixed supply of 210,700,000 coins, while Ethereum (ETH) has no fixed supply. Secondly, Ethereum Classic is using Proof-of-Work (PoW) consensus algorithm, while Ethereum is currently transitioning from Proof-of-Work to Proof-of-Stake (PoS).

Which one is the better cryptocurrency? Before we go there, let’s learn a little bit about their history.

The History

Ethereum DAO hack was the history that triggered the split
In the beginning, there was only one Ethereum chain. In 2016, this original Ethereum chain had a DAO (Decentralized Autonomous Organization) with a simple objective - to govern the entire Ethereum network and make decisions. The DAO successfully raised over $150 million, way above Ethereum Foundation’s expectation. 

However, the DAO had a security loophole, and it was exploited by a hacker. The attacker successfully stole more than 3.6 million Ether (over $60 million at that time). Due to this unfortunate incident, the Ethereum Foundation decided to do a hard fork in July 2016 to reverse the funds that were affected by the DAO hack. The idea was that the hard fork would give back all the stolen ETHs to the original contributors.

However, there were a lot of people in the Ethereum community that opposed this idea because they believed every transaction in blockchain should always be “immutable”. They claimed any proposal to do transaction reversal would defeat the entire philosophy of blockchain itself.

Due to the inability to find the middle ground, the hard fork that happened at that time became the Ethereum that we know today (ETH). On the other hand, the original Ethereum chain became Ethereum Classic (ETC).

Until today, both ETH and ETC are still very relevant in the cryptocurrency market. When it comes to market cap, Ethereum is second only behind Bitcoin, while Ethereum Classic is still trading inside the top 30 rankings.

The Case For Ethereum (ETH)

ethereum is the more popular crypto between them
So, why would anybody buy Ethereum instead of Ethereum Classic? The answer is simple - the team that developed Ethereum supported the hard fork. Ethereum Foundation, up to this day, is still busy developing Ethereum. 

When you have the entire core developers and big funds behind Ethereum, you know that means Ethereum has way bigger potential than Ethereum Classic. Ethereum is also in the process of transitioning from Proof-of-Work to Proof-of-Stake, which should reduce 95% of Ethereum’s energy consumption. After the completion of this transition, the gas fees should also become much cheaper for Ethereum.

At the moment, most decentralized applications (dapps) are being built on top of the Ethereum chain. Despite heavy competition from other blockchains, Ethereum is still able to stay on top of other smart contract platforms. Many experts predict Ethereum might eventually become bigger than even Bitcoin itself (also read: why Bitcoin will remain the most popular cryptocurrency)

Another important point is that Ethereum never suffered any 51% attack after the split. Meanwhile, Ethereum Classic has suffered a few 51% attacks in the past. 51% attack is basically an incident where the attackers had enough hashing power to manipulate transactions (called double-spend attacks), where they can receive the same cryptocurrencies more than one time.

When it comes to blockchain security, Ethereum has a much more proven track record compared to Ethereum Classic.

The Case For Ethereum Classic (ETC)

ethereum classic is less famous but it has its own benefits
Despite being the original chain, Ethereum Classic is actually less popular than Ethereum. That being said, ETC is still able to maintain its relevance in the top 30 crypto market cap rankings. The main selling point of ETC is actually more about philosophy rather than features. 

Back in 2016, most people who decided to follow and maintain ETC were the kind of people who believed blockchain transactions should always be immutable. They didn’t like the idea of reversing transactions, even though they sympathized with the DAO hack victims. They believe the Ethereum Foundation broke the trust that people put in the immutability of the original Ethereum chain.

That’s why they decided to keep supporting Ethereum Classic after the split between the two. As mentioned above, the biggest difference between Ethereum and Ethereum Classic is the fact that Ethereum Classic has a fixed maximum supply (210,700,000 coins) while Ethereum has no maximum supply. 

Once Ethereum completes the entire transaction to Proof-of-Stake, this will be another big difference between the two. Ethereum Classic will always use the Proof-of-Work consensus mechanism, which is crucial for miners.

The Future Between Ethereum vs Ethereum Classic

time to ask question, which one is better between eth and etc?
Between ethereum vs ethereum classic, which one has a better future? This is not financial advice, but I think everybody will be biased toward Ethereum (ETH). The thing is, Ethereum has been able to stay in the second position in crypto market cap rankings for a very long time and might even surpass Bitcoin sometime in the future.

Ethereum is the most popular smart contract platform and will continue to be the most popular for the foreseeable future. Ethereum core developers also promise sharding and other high scalability features that will be implemented after 2023. Once they implement all of these features, it’s believed Ethereum will become much faster and cheaper than Ethereum Classic.

Not only that, Ethereum has gained a lot of trust in its ecosystem. It has support from Enterprise Ethereum Alliance (EEA), which is basically a global community of Ethereum adopters and developers, including Microsoft, Citibank, FedEx, JP Morgan, AMD, and others. Ethereum Classic does not have support with the same level of caliber.

However, nothing truly knows what the future holds. It’s still very possible for Ethereum Classic to surpass Ethereum one day. We live in interesting times, and the crypto market is always unpredictable.

If you want to support the type of Ethereum that will always use a Proof-of-Work consensus algorithm, maybe Ethereum Classic is the right answer for you. But if you believe the type of chain that will adopt a faster and cheaper mechanism, the right answer is Ethereum (ETH).
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