The Ethereum Classic (ETC), if you look closely, bears Ethereum, and that means one way or the other, the Ethereum Classic has a thing or two to do with the mainstream cryptocurrency, Ethereum (ETH). Ethereum Classic rose as a decentralized, open-source blockchain that supports several kinds of smart contracts.
What exactly led to the breakout, or if you like, Fork? Why the need for a classic when we already have the mainstream cryptocurrency? Let’s answer that in the next few lines. However, for the sake of our growing audience of new Crypto enthusiasts, who may not know for certain what a Fork is in the Crypto Space.
What is a Fork in Cryptocurrency?
Fork is a cryptocurrency term used to connote the splitting of one digital coin into two different coins. One retains the original attributes of the first coin, from which they were forked, while the other tends to derive its own newer properties and key features.
Forks in the Cryptosphere are of two types: Hard Fork and Soft Fork. We won’t dive into all of that now, so that we can keep focus on the agenda at hand.
The Origin of Ethereum Classic: The DAO Hack
DAO stands for Decentralized Autonomous Organization. It was established as a project back in 2016 by the already existing Ethereum community. Guess what, the project garnered about $150 in ETH, but here is the hard blow.
Unfortunately for the larger community, the defect the DAO had at the time of its formative years became the reason for its eventual downfall. The entire initiative was hacked before it had the time to find its feet. So great was the hack and consequent downfall that an amount of $60 in ETH was moved away to some unknown sources. What ???
That’s not the end of the story yet, there is more. So what happened next?
After the massive incident of losing $60 from the original profits of $150, concerns rose and intensified within the already existing Ethereum community. Some believed that the blockchain should be reverted to see if the damage already done can be ‘undid’, while some maintained that the blockchain should be kept as immutable as it is with no alteration.
This story is heating up gradually. Both thoughts and opinions stood after much deliberation, the majority chose to hard fork and so try to revert the hack, this majority became the founding pillars of what is today known as Ethereum (ETH). Contrary to public expectation, the other group that chose to stick with the original idea of keeping the blockchain immutable as it is, formed what is today known as the Ethereum Classic (ETC).
Is it making a lot of sense now? Good to know you’re following. Such is the case with the origin of ETC. Of course, both ETC and ETH never remained the same after the hard fork. Both now have different guiding rules and modes of operation, although some practices are still the same.
A Technological Overview of How Ethereum Classic Works
Consensus Mechanism
Consensus mechanism refers to the method adopted by a digital coin to reward miners for validating transactions and securing the network. Ethereum Classic uses a Proof of Work consensus mechanism, which is similar to that used before the pre-merge incident of Ethereum. It rewards miners in ETH, who validate the daily transactions happening in the blockchain and therefore, by doing so, keep the network secure.
Smart Contracts & DApps
Ethereum Classic allows developers to adopt decentralized applications just like Ethereum does. This, by experience, means the same programming language can run either way.
ETC’s Network Upgrades
Following the 2016 Fork experience, ETC has implemented certain upgrades over the period of time it has existed (like Agharta and Magneto). This is for compatibility and security’s sake, even though at some point it diverges from Ethereum’s already proposed roadmap.
Impact of Ethereum Classic (ETC) on the Larger Cryptocurrency Community
Preservation of Crypto’s Core Values and Heritage
Ethereum Classic has long preserved many of blockchain’s early values, such as immutability and decentralization, which are similar to mainstream cryptocurrencies like Bitcoin.
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A Strong Platform for PoW Smart Contracts
After the hard Fork, Ethereum started using the Proof of Stake (PoS) consensus mechanism, leaving ETC as the largest smart contract platform that still uses the Proof of Work (PoW) consensus mechanism. This is an attractive prospect for miners looking to keep track of their mining journey.
Provision for Security Diversity
Ethereum Classic makes a provision for an alternative infrastructure to the conventional model. This singular approach is built to accommodate diverse ecosystems where overly depending on just one single chain could spell disaster.