• Mon. Sep 26th, 2022

Ethereum vs Ethereum Classic: Which should you trade?

ByNdasi Tata

Jul 26, 2022
1658213455438 45668b5d a9d7 4a57 86af 12903fa599f0
1658213455438 45668b5d a9d7 4a57 86af 12903fa599f0

Ethereum and Ethereum Classic are two similar blockchains, yet they carry a stark contrast. Ethereum is ranked the second largest cryptocurrency, with a market cap of $185.4 billion. Ethereum Classic is ranked at position 22 with a market cap of $3.4 billion. So what distinguishes them?

Ethereum Classic is a hard fork of Ethereum

Ethereum classic was founded in 2016 as a hard fork of the Ethereum blockchain. That was after a major hacking incident on Ethereum. Ethereum Classic relies on ETC, its native cryptocurrency, to run transactions. Both Ethereum and Ethereum Classic carry smart contract functionalities. They are decentralized, and privacy protection comes on top for both blockchains. 

Nonetheless, as with most hard forks, the forked blockchains carry some unique attributes. Ethereum Classic is a Proof-of-Work blockchain. Miners have to crack mathematical problems to validate transactions. They subsequently get rewarded with ETC tokens. While Ethereum runs on the PoW consensus mechanism, it is transitioning to Proof-of-Stake. Users will need to stake ETH to become validators, a less energy-intensive process. The shift to PoS or merge is expected from September.

Another major difference is that there is no capped supply for Ethereum. Nonetheless, developers have set a base 4.5% increase every year. A burning mechanism helps to keep the supply in check. Contrary, Ethereum Classic has a fixed supply. The maximum supply in the market is 230 million, and tokens cannot exceed the limit. 

Which should you invest in?

Ethereum ranks ahead of its hard fork with its market valuation. It is already dominant in the NFT and DeFi sectors. For PoS lovers, Ethereum comes top due to the upcoming merge. However, Ethereum Classic comes on top when considering a cheaper ETH alternative. We find both tokens have similar price trends. Investing in either token depends on the interests of the investor.

The post Ethereum vs Ethereum Classic: Which should you trade? appeared first on CoinJournal.

Ndasi Tata

Ndasi Tata is a Cameroonian-born Bitcoin entrepreneur and former state journalist. He earned an M.Sc from the University of Nicosia in Cyprus in Blockchain and Digital Currency. He uses a variety of social media channels to promote his ideas and projects , and he's a major proponent of Bitcoin in Africa.

Need Help?
Scan the code