Ethereum vs Ethereum Classic – Introduction
Both cryptos have similar names and they’re practically the same currency, but they have different concepts: This is how we can define the Ethereum (EHT) x Ethereum Classic (ETC) relationship. If you’re interested in learning more about it, you should keep reading.
Over the next few topics, we’ll explain when and why occurred the division that originated ETH and ETC. In addition, we’ll introduce you four major differences between both digital currencies. Enjoy it!
Ethereum Network and Ether
ETH it’s a large platform where it’s possible to execute several actions in it. For instance, financial trading, game development, applications, systems and so on. The most interesting thing is that its servers are completely decentralized, in other words, it can never be turned off.
Vitalik Buterin, Russian-Canadian programmer and writer started the ETH project in 2013. However, only in 2015 with a team formed by Gavin Wood, Anthony Di Iorio, Charles Hoskinson, Mihai Alisie, Joseph Lubin and Amir Chetrit, Buterin’s project got into the market.
But, after all, where is the Ether in all of this? Well, Ether is a cryptocurrency that is used within the ETH network. However, it’s more than a crypto, it’s the major asset used to perform any type of transaction within the platform.
In other words, if you want to create an app on the ETH network, you’ll need to use Ether. The same will be necessary for those who want to buy this app. This is just an example. In practice, Ether is used in a large number of transactions.
Hard fork
In 2016, ETH developers launched a new idea for the project: Decentralized Autonomous Organization (DAO). It was successful and collected $150 million in Ether. But, at the same time, hackers identified a system error and stole $50 million.
The cyber attack had great repercussions, causing the team to fall apart. Part of it would like to see the blockchain network for the last time to stop the last transactions made by hackers, thus stopping the cyber attack. However, some people in the group said it was an abuse to system integrity and they didn’t want to mess up with the Blockchain’s code.
This situation led the company to a hard fork, for this reason two independent projects – ETH and ETC – were created. The first one was led by the group that wanted to stop the last transactions while the second one didn’t want to modify blockchain code.
The differences between ETH and ETC
Now, you understand the relationship between ETH x ETC. However, what is the difference between both projects? There are several details that differ from each other. Here, we’ll show you four major details.
Currencies amount
Crypto used within the ETC has a finite supply. Therefore, only 230 million ETC will be available on the market. This makes it a deflationary currency such as Bitcoin.
On the other hand, ETH didn’t have a finite supply. Developers chose it to keep the network without a fixed budget to facilitate its increase.
Mining Algorithm
ETC and ETH mining is based on proof-of-work (PoW), which is a system that uses the resolution of complex mathematical equations to validate transactions.
However, ETH is modifying its algorithm to a new one – proof-of-stake (PoS). In this system, miners need to leave a certain Ether amount in the system to make the validations.
Then, the platform will send the transactions randomly for each validator to analyze and release them.
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Transaction Capability
PoW is a complex process and it may take a while to complete. On the other hand, PoS is faster and requires less resources than PoW. This makes the transaction capacity of ETC smaller than ETH network.
In real life, this difference is quite large. After all, ETH makes around 600 thousand trading daily while the ETC registers only 40 thousand trading daily.
The project team
The developers team responsible for the ETH network is basically the same as hard fork, led by Buterin.
In contrast, ETC doesn’t have an official team. What exists is a developers community that works all over the world, keeping the project in progress. Moreover, developers don’t need specific permissions to contribute to the platform – they have free access to it.
Ethereum vs Ethereum Classic – Conclusion
ETH and ETC were created at the same project. However, they’re different platforms and their cryptos are different from each other as well.
While the ETC keeps its original format, ETH is always updating its system. Because of that, the last one is more popular and valued than ETC.
Did you like this article? If you do, you should take a look at this one: How Ethereum Works: Beginners guide!
