If you’re new to digital currency, seeing Ethereum and Ethereum Classic could confound you. You could either go for Ethereum or Ethereum Classic. What’s the distinction between them?
What are the distinctions between Ethereum and Ethereum Classic?
Ethereum Classic is viewed as the traditional Ethereum for specific reasons. On the off chance that you are much of an observer, the name ‘Ethereum Classic’ would have hinted to you the contrast between them, as classic means traditional. If you speculated thus, you guessed correctly.
What Differentiates Ethereum from Ethereum Classic?
- CURRENCY: These two Ethereum versions have distinct native currencies. Ethereum’s coin is called ETH, while Ethereum Classic is called ETC.
- HISTORY: The historical backdrop of the creation of these two variants is fascinating. It’s even more intriguing to know that Ethereum was only a single currency when it was introduced. However, in 2016, an unknown hacker looted millions of ETHs from a smart network under Ethereum called DAO (Decentralized Autonomous Organization) after discovering a loophole in its blockchain.
It steered the creators to take a huge decision. They resolved to reverse the hack by splitting the network into two, generating a new blockchain. However, some users perceived this to be a betrayal of the doctrine of ‘code is law,’ meaning that a blockchain is inflexible.
This faction of miners refused to elevate to the new blockchain, causing a hard fork; thus, creating two currencies; Ethereum and Ethereum Classic. Ethereum became the new network, while Classic is the original.
- SUPPLY: The supply of Ethereum is limitless, which gives it an edge over Ethereum classic, which has a restricted supply, its maximum supply being 210,700,000.
- PRICE: The cost of both currencies is dissimilar. The rate of one unit of Ethereum Classic is 21 USD, while Ethereum sells at 1,795 USD. However, this is just the current price but can change anytime.
Ethereum hit its all-time high in November 2021 at 4891.70 USD, while Ethereum Classic hit its all-time high in May 2021 at 167 USD.
- CHANGES: One thing that has distinguished ETH from ETC is its growth. Though Ethereum Classic has remained quite traditional, Ethereum has plans to expand by moving from the proof-of-work consensus mechanism to proof-of-stake. It will permit miners to stake their Ethereum, then, validators will be selected randomly to validate a block, and they will be reimbursed in ETH.
On the other hand, proof-of-work, which Ethereum and Ethereum Classic run on as of now, uses a competitive validation strategy to verify transactions. It prompts electronic waste because it consumes a lot of energy.
As of June 8th, 2022, Ethereum ran a merge test on the Ropsten network. The developers integrated the proof-of-work and proof-of-stake chain in anticipation of the main merge of the Ethereum network to occur later this year.
Both cryptocurrencies perform similar functions as they foster many applications like DeFi. They are also used for purchases in the metaverse besides their fundamental function as a digital currency. These differences will direct you in making choices.
Is Ethereum a Better Investment Option than Ethereum Classic?
If you’re a trader who wishes to buy Ethereum or Ethereum classics, you must discern which is a better alternative to invest in. While both platforms have pros and cons, Ethereum is commonly considered more reliable than Ethereum Classic.
Although the low price of Ethereum Classic is a significant inducement, it lacks substantial growth, making it less popular than Ethereum, which has developed to become the second-largest cryptocurrency; this is why many investors prefer to buy Ethereum.
Ethereum Classic has a hard cap rate following Bitcoin’s trend, but Ethereum does not, though its supply can only grow to 4.5 percent yearly.
Ethereum Classic has additionally lost the trust of investors because of the various 51% hack assaults it has confronted, making it untrustworthy. Then again, Ethereum is moving up to the PoS (Proof-of-Stake) agreement component to make purchasing ETH more secure and more important.
Lastly, Ethereum’s hash rate is multiple times higher than Ethereum Classic’s. It makes buying Ethereum more attractive. Also, Ethereum facilitates more Decentralised Apps than Classic, so it’s a better place to invest.
The list goes on and on. Considering the many advantages Ethereum has over Ethereum Classic, it is wiser to buy Ethereum, seeing its possibility of growth.
Ethereum and Ethereum Classic are similar cryptocurrencies mainly because they came from the same root. However, since the split, these two versions have grown on quite a different tangent in many ramifications, so it is essential to know their distinctions and use them as a guide when buying Ethereum.