Cryptocurrencies, as exciting as they appear, come with some flaws. Hence, based on the update form, the system must be updated to stay in the game. A soft fork occurs when an update is backward-compatible, meaning that a node is not required to upgrade the blockchain to stay within the network.
A hard fork, on the other hand, is quite distinct and far more complicated. Over its existence, several forks have occurred on Ethereum, including Ethereum Classic. The fork usually occurs due to disagreement among miners over a decision that results in the origin of two different currencies.
The Ethereum and Ethereum Classic divide sparked a schism within the cryptocurrency ecosystem. Even though Ethereum Classic is named after Ethereum, the two are pretty similar in several ways, yet they have distinct characteristics that separate them.
DeFi and smart contracts are at the heart of Ethereum, while Ethereum Classic has several other uses and has been focused on crypto attacks. Before selecting which is better, it’s crucial to grasp basic information about the ETH and ETC before selecting which is better. In this article, we’ll look into the details of Ethereum and Ethereum Classic and their significant differences.
Ethereum is a decentralized blockchain-based platform that enables the creation of decentralized apps (DApps) and smart contracts. It was introduced in 2013 by programmer Vitalik Buterin and soon emerged as one of the most well-known blockchain platforms, second only to Bitcoin in terms of market valuation.
The Ethereum network is intended to be more adaptable than the Bitcoin blockchain, supporting more complicated smart contracts and DApps. Ethereum developed the smart contract as a groundbreaking unique innovation in the blockchain system.
(ETH) is Ethereum’s native token and is employed to pay transaction fees and motivate network users to verify transactions and preserve the network. Anybody may use Ethereum to construct any safe digital technology. It contains a token meant to compensate members for labor performed in favor of the blockchain, but it may also be used to buy physical products and goods if approved.
Moreover, one of Ethereum’s primary characteristics is its potential to enable smart contracts. Smart contracts are contracts that may be configured to operate automatically when specific criteria are fulfilled.
They enable the execution of complicated financial transactions as well as the development of decentralized apps that can function independently without relying on a central system.
Another significant characteristic of Ethereum is its use of the proof-of-work consensus algorithm (PoW). Network members, known as miners, employ their processing capacity to tackle challenging arithmetic problems and verify transactions via the PoW consensus method. This approach assures network security and the validation of all transaction members of a decentralized platform.
Ethereum is well-known for its usage of smart contracts and the PoW consensus process, its active developer population, and the diverse variety of DApps and DAOs-decentralized autonomous organizations established on its network.
These DApps and DAOs are meant to run independently with no need for the involvement of any central authority, resulting in more transparency and safety than typical centralized systems.
Most businesses developing technologies choose Ethereum to make their software based upon it to transform how many industries work and how we live our lives.
The whole concept of DAO was to create an opportunity for crypto users to make investments in new cryptocurrency initiatives. Individuals put Ether in the DAO in exchange for voting tokens.
One of the issues that Ethereum faces is scalability. Too many network transactions can cause congestion, resulting in slower transaction rate times. In order to get their transaction done, users will pay a reasonable amount ultimately leading to an increased transaction cost.
To solve this problem, Ethereum is now going through a significant update called Ethereum 2.0, which will shift the network from a PoW-proof-of-work to a proof-of-stake PoS consensus process and incorporate additional changes targeted to boost scalability and minimize transaction costs.
Understanding Ethereum Classic
Like Ethereum, Ethereum Classic is also a blockchain-based platform that is decentralized and is a derivative of the original Ethereum. It is intended to be an alternative and emphasize maintaining the blockchain’s immutability and decentralized ideals. It resulted due to a hard fork that took place on the Ethereum network after the DAO heist.
After a dispute among the Ethereum ecosystem about handling a significant hack of a famous Ethereum-based project titled “The DAO,” Ethereum Classic was born in 2016. So what happened in 2016?
In 2016 the DAO got hacked, and the Ethereum blockchain heist occurred. An anonymous hacker took $50 billion of tokens from DAO, sparking debate in the cryptocurrency world. Several individuals in the network thought that hard forking the Ethereum blockchain and reverting the attack would be the best option.
At the same time, some argued that this violated the basic tenets of blockchain immutability. Ultimately, the hard fork led to the split into two different blockchains. The older version became Ethereum classic, and the latest one became Ethereum.
One of the most important characteristics of Ethereum Classic is its commitment to the blockchain immutability concept. This implies that after a transaction is stored on the blockchain system, it cannot be changed or removed, regardless of whether it was illegal or the product of fraud.
Some consider immutability a basic concept of blockchain systems, but Ethereum Classic has worked hard to uphold this notion amid criticism and debate.
Ethereum Classic functions similarly to Ethereum, enabling smart contracts and the construction of Dapps. These tools help businesses run more smoothly, handle assets, and conduct various financial activities. Transactions are safeguarded using encryption and performed and validated by all network users.
Ethereum Classic employs a PoW consensus algorithm (PoW) where Miners attempt to tackle cryptographic problems to verify transactions and produce new blockchain blocks using the PoW algorithm. It also includes a decentralized virtual machine called the Ethereum Virtual Machine. EMV can run programs across a worldwide system of public nodes.
One of the issues that Ethereum Classic has is that it has a weaker user base and a less engaged developer community than the current Ethereum network. But on the good side, the Ethereum Classic community is dedicated to the ideas of immutability and decentralization, and the network keeps attracting users and developers who embrace these beliefs.
Similarities Between Ethereum and Ethereum Classic
Ethereum and Ethereum Classic have a common history and many similarities. However, there are also significant distinctions between the two. Here are some of the key similarities between Ethereum and Ethereum Classic:
Blockchain Technology: Ethereum and Ethereum Classic both employ blockchain technology, which is decentralized, and records all transactions.
Ethereum and Ethereum Classic both encourage the creation of decentralized applications (dApps) that operate on their platforms.
Ethereum and Ethereum Classic are open-source programs, implying that anybody may access, alter, or use their source code.
Both systems depend on miners to confirm transactions and then add them to the chain in the blockchain using proof-of-work (PoW) consensus algorithms.
Token standards, are rules that regulate the production, exchange, and maintenance of crypto assets on their respective systems and are used by both Ethereum and Ethereum Classic. The Ethereum network, for instance, employs the ERC-20 token standard, whereas Ethereum Classic employs the ETC-20 token standard.
Despite these parallels, it is vital to emphasize that Ethereum and Ethereum Classic have distinct communities, software developers, and future aspirations.
Ethereum has a bigger customer base and more active development, whereas Ethereum Classic is more concerned with preserving the original decentralization and immutability ideals.
Key Differences between Ethereum and Ethereum Classic
Ethereum Classic and Ethereum have the same code. This code separates into two distinct routes. But, the evolution of these two paths throughout time has substantially altered the hypothetical worth of digital assets.
Though, there are not as numerous distinctions between these two tokens, owing to their intrinsic similarities, these few variances are too crucial to overlook.
The DAO Hard Fork
The first and important difference between the two is that Ethereum Classic is the first Ethereum blockchain, formed in 2016 due to the DAO hard fork. Ethereum, on the other contrary, emerged following the hard split that occurred after the DAO hack’s transactions.
Creation and Structure
Vitalik Buterin, a 19-year-old programmer, was the man who created Ethereum as a result of his fascination with blockchain and its innovation Bitcoin. He intended to leverage this cutting-edge technology to establish his cryptocurrency platform, enabling smart contracts and DOAs to operate and conduct transactions in new ways.
He was well familiar with the token’s asset’s limitations and attempted to remedy those via an initiative. Buterin intends for smart contracts to be used to write basic agreements, such as property deals, and complicated programs that support DeFi app’s decentralized exchanges.
Even though Ethereum Classic performs the same functions as the original Ethereum, the developed world has mostly disregarded it. Because Ethereum Classic has no NFTs, DAPPs, or any other functionality, it has become the target of the majority of malicious assaults.
Both Ethereum and Ethereum Classic can conduct 12-15 transactions in one second, and the transaction cost depends on the time it takes to complete a transaction. The faster the transaction speed, the more the transaction fees will be. Ethereum Classic outperforms Ethereum regarding transaction costs.
Ethereum Classic transaction fee is close to nothing. On the contrary, Ethereum’s transaction fees are prohibitively expensive, particularly considering the latest rise in network traffic issues. Gas costs may approach $15 and have to be paid in its native token ETH, causing demand to rise.
Ethereum’s latest update, i.e., Ethereum 2.0 was laughed in September 2022. This was the update that users had been waiting for a long time. Ethereum 2.0 allows its users to speed up the transaction process and improve scalability. Another upgrade will likely occur in March 2023 with the same objective.
The token supply of the two platforms also differs. Ethereum has no supply cap for the tokens, and unlimited supply is available. The most appealing aspect of having ETH coins is that it necessitates using Ether for every crypto transaction.
This leads to more Ether being burned, implying that the supply is shrinking, which will ultimately result in a rising price of Ethereum as user involvement and transaction volume grow. Because of these changes, Ethereum has become a deflationary cryptocurrency that investors are interested in.
While Ethereum Classic has, supply is limited. It has a ten times greater supply than Bitcoin, which is 210 ETC. In addition, for every Five million ETH generated, Ethereum Classic has fixed block incentives for miners to decline by 20%.
Another key distinction between Ethereum and Ethereum Classic is their consensus method. Ethereum started with the Proof of Work consensus method, but it transitioned completely Proof of Stake algorithm In 2022 during the merge. On the contrary, the Ethereum Classic system employs the PoW method and has no plans to convert to another.
ETH can power decentralized apps (dApps), which is a must for users to utilize to engage on the network. Users may require to utilize ETH to trade for other relevant coins. On occasions, dApps may demand some ETH to complete certain activities. No dApps exist on Ethereum Classic.
The prices of both Ethereum and Ethereum Classic are vastly different. Ethereum is the most widely used and well-accepted cryptocurrency. On 9 January 2022, ETH was worth $3,169, while ETC was worth $30. ETH hit a record of over $4,700 by November 2021, while ETC touched its highest in May 2021, which was $134.
Ethereum possesses a bigger user base and stability than Ethereum Classic. This renders ETH less volatile generally and much more prominent on exchanges, lowering the risk of investing. Ethereum is supported by the Corporate Ethereum Alliance, a network of over 200 members that includes major corporations such as Microsoft.
The governance system of Ethereum Classic is more decentralized, with decisions decided by majority consensus. Ethereum, in contrast, features a more centralized system, with decisions taken by the Ethereum Foundation as well as other major actors in the ecosystem.
Market Cap and Adoption
Ethereum has a bigger market capitalization and is more frequently used than Ethereum Classic. This implies Ethereum has a larger user base, more programmers working on its network, and more resources dedicated to its development and advancement.
Both Ethereum and Ethereum Classic support smart contracts, but there are some differences in the programming languages used. Ethereum Classic uses a programming language called “Ethereum Virtual Machine (EVM) bytecode,” while Ethereum uses a higher-level programming language called Solidity.
Ethereum’s more active development team is constantly improving and upgrading its technology. Ethereum Classic, in contrast, has a smaller development team and is focused on maintaining the original blockchain and staying true to its decentralized principles.
ETH vs. ETC: Which One is Better Investment Choice?
Although both ETC and ETH support smart contracts, Ethereum has outperformed its competition in terms of acceptance, trust of the people, and market price. In addition, ETH is the second largest cryptocurrency worldwide behind Bitcoin, with other blockchains like Cardano trailing far behind.
Ethereum Classic network has been under attack several times. It was vulnerable to 51% assaults, which emerge when a miner gained ahold of the platform’s hash rate and afterward utilized it to overspend and steal money. These problems may prohibit Ethereum Classic smart contracts from getting utilized in big financial operations.
Another area for improvement concerning ETC is its scalability. It can conduct 15 transactions per second, considerably fewer than the more than 1,000 transactions per second handled by payment providers like Visa. After multiple software changes, Ethereum Classic’s payment mechanism scalability remains a severe concern.
As previously stated, Ethereum is transitioning from a PoW system to a PoS paradigm (also referred to as Ethereum 2.0), allowing users to confirm transactions and generate additional ETH depending on their ether assets. This update boosts Ethereum’s ability to accommodate its increasing user base, reducing congestion issues and lowering transaction costs.
Ethereum is also being embraced rapidly, even by big businesses. For instance, Advanced Micro Devices (AMD) proposed cooperation with ConsenSys to construct a system of data centers based on the Ethereum network. In conclusion, Ethereum is a better option for investment.
To summarize, Ethereum and Ethereum Classic are two distinct blockchain platforms that have a shared past but differ in their growth and management systems. With a bigger market cap, a bigger user base, and a stronger active development team centered on advancement and improvement, Ethereum is the more popularly used system.
With a smaller development team and a more hands-off approach to governance, Ethereum Classic is more centered on sustaining the original ideas of decentralization and community consent. Both networks offer smart contracts and decentralized apps, but there are variations in their programming languages and performance targets.
Thus, the decision between Ethereum and Ethereum Classic is based on personal choices and ideals, as each network has unique benefits and drawbacks.