Home » Will Ethereum Classic (ETC) Finally Take Off Now That Ethereum 2.0 Is Coming? Will Ethereum Classic (ETC) Finally Take Off Now That Ethereum 2.0 Is Coming? Sydney Ifergan
Ethereum Classic (ETC) has remained in the shadows as the lesser-known token from the Ethereum network compared to the more famous ETH which currently sits in the second spot in the crypto market cap ranking.
To get a good understanding of what ETC is, think of it as a split timeline from the original blockchain.It is a long story but the short version is that ETC was created through a hard fork of the Ethereum network to reverse a DAO hack that stole roughly $50 million worth of ETH in 2016.The hard fork created a split where the blockchain was rolled back restoring the lost ETH while the other split chain continued as if the rollback never happened.However, the stolen ETH which was converted into ETC in the hard fork was recovered and returned to its owners.
While ETH has gone on to hit historic highs above $4,000, ETC’s all-time high of 179.83 is miles lower.Its underperformance is due to a variety of reasons such as more development on the ETH blockchain and other factors such as 51% attacks which have happened four times in the past.Nevertheless, ETC’s price action has been quite active this year.
ETC traded as low as $5.59 in January 2021 before embarking on a parabolic rally which saw it soar to the aforementioned historic high in May.It has since then lost some of its gains and is currently trading at $59.83.Source- Binance
ETC may have derived some of its gains from the overall bullish performance of the crypto market earlier this year.
However, some developments may have contributed to the price rally.For example, there has been a lot of institutional buying of ETC.Greyscale founded an Ethereum Classic trust in 2018 and it currently holds $1.3 billion worth of ETC.This makes Grayscale the largest ETC whale.
Greyscale has increased its ETC holding five-fold so far this year, especially after the announcement of the upcoming Ethereum 2.0 launch.
This is also another potential reason why Ethereum Classic has been gaining value.The Ethereum Classic network still operates through a proof-of-work consensus which means that many of the people who mine on the Ethereum network will likely start staking once Ethereum 2.0 is launched.They will likely use their mining hardware for ETC mining and the recent increase in Ethereum Classic hash power is a sign that the transition is already happening.
An increase in participation in the Ethereum Classic network will have a positive effect on price performance.
An ETC treasury might soon be launched courtesy of a proposal presented by IOHK in August 2020.Such a development might provide fuel for the bulls, potentially pushing the price to new highs or previous highs before the end of 2021.
The Ethereum 2.0 rollout’s impact on Ethereum Classic remains to be seen but the ongoing roadmap development with the help of IOHK may provide an additional push for ETC.The pursuit of an ETC treasury will be a good move for the network because it will facilitate funding for multiple development projects and teams.
Having multiple development teams is good for the network because it will favor a more inclusive community voting, thus eliminating the likelihood of ecosystem monopolization.The treasury might also facilitate more competitiveness on the network, and the funding necessary for a roadmap that will eventually enable more visibility and adoption for the network.All this means that ETC is rapidly approaching some interesting times ahead, thus further solidifying its position in the cryptocurrency market.
Advertisement.
