Ethereum Vs Ethereum Classic - A Crypto Comparison

14 Dec 2023 by Rory Kejzerko 7 min read

Ethereum vs Ethereum Classic is a distinction many crypto traders may be wondering about, as whilst both are used to build smart contracts for decentralised apps (dApps), they also share many differences.

With many distinctions in play, you may be wondering which cryptocurrency is for you. That’s why we’ve devised the following outline of the key similarities and differences between Ethereum vs Ethereum Classic.

What is Ethereum (ETH)

Ethereum is undoubtedly the more popular crypto of the two, as it’s one of the most widely embraced cryptocurrencies on the market.

Through leveraging Ethereum’s interoperable programming language, its developers have crafted a thriving ecosystem of dApps up until now, spanning across financial services, gaming, NFTs, and beyond. These applications execute on smart contracts, ensuring functionality based on predefined conditions.

The blockchain’s native ETH token serves as the medium in which users engage with these dApps. The quantity of ETH (a.k.a Ether) required for a smart contract hinges on the intricacy of the underlying process.

Further, developers earn fresh ETH by appending blocks to the ledger and collecting transaction fees from smart contracts. This incentivises the community to actively utilise the platform for dApp development.

Remarkably, Ethereum imposes no constraint on the number of tokens operational throughout its existence, yet its growth is capped at a modest 4.5% annually.

Ethereum Features

Trade Symbol: ETH

Formation: 2015

General Purpose: dApp development and smart contract support

Maximum Available Supply: No limit, but growth capped at 4.5% per year

Mining Standard: Proof of Stake

Mining Reward: Transaction fees

What is Ethereum Classic (ETC)

Ethereum Classic emerges as a distinct branch of Ethereum, as it arose in reaction to alterations in the original Ethereum blockchain. Here, its primary emphasis therefore lies in preserving the foundational features of Ethereum.

Presently, Ethereum Classic remains unaligned with any updates on the Ethereum network, resisting the likes of hard forks, as well as ‘The Merge’ transition that saw Ethereum go from adopting a Proof-of-Work (PoW) to Proof-of-Stake (PoS) consensus mechanism.

Identified by the ticker symbol ETC, Ethereum Classic operates through smart contracts, generating Ether under the ETC token designation. The platform centres on a framework where users lack the capability to modify transactions in a blockchain's historical records. In turn such design guarantees transparent tracking of various transactions on the blockchain, all while maintaining the pseudonymous nature of the involved information.

Ethereum Classic Features

Trade Symbol: ETC

Formation: 2016

General Purpose: dApp development and smart contract support

Maximum Available Supply: 230 million

Mining Standard: Proof of Work

Mining Reward: Transaction fees

Ethereum Vs Ethereum Classic - Similarities

Ethereum and Ethereum Classic primary share a foundational design principle that’s focused on decentralisation and eliminating reliance on a single entity to govern. Additionally - and like all other blockchains - their operations revolve around a network of computers or nodes.

Smart contracts play a pivotal (and similar) role in both iterations of Ethereum, as they demand adherence to predetermined terms at specific intervals. In doing so, both ETH and ETC smart contracts uphold proficient safety and security measures.

While Ethereum Classic distinguishes itself from Ethereum by maintaining an immutable transaction history, both platforms adopt pseudonymous structures wherein transactions reveal public keys whilst concealing personal names and identifying information. This deliberate design choice safeguards specific details, ensuring their privacy.

Ethereum Vs Ethereum Classic - Differences

When it comes to the differences of Ethereum vs Ethereum Classic, the former hosts a dynamic wherein past transactions hold the potential for modification and adjustment. Conversely, Ethereum Classic adheres to the original Ethereum system which champions immutability and ensures that users cannot alter transactions within the blockchain's historical records.

In the realm of mining, Ethereum Classic employs a PoW process - akin to Bitcoin (BTC) - where miners validate transactions to earn ETH rewards. In contrast, the current Ethereum system has transitioned to a PoS process, wherein transaction validators contribute stakes to the mining process for the opportunity to append a new block to the chain (consequently earning a reward).

Ethereum has the flexibility to generate as many tokens as needed, constrained only by an annual growth cap of 4.5 percent. In contrast, Ethereum Classic faces a lifetime limit of 230 million tokens.

As of December 2023, Ethereum boasts a token value of around $2,200, securing its position as the second-largest cryptocurrency with a market cap of over $260 billion. Ethereum Classic, in comparison, maintains a smaller stature, exhibiting a token price of around $20 and a market cap of almost $2.9 billion.

Noteworthy is the divergent trajectory of these two cryptocurrencies, as whilst Ethereum is open to potential future changes, Ethereum Classic remains steadfast and unwaveringly adhering to the original rules of Ethereum.

Ethereum Vs Ethereum Classic - Conclusive Thoughts

Ethereum stands out as a remarkably successful blockchain, boasting a vibrant developer community and continuous innovation. Its prowess in decentralised finance (DeFi) is evident, commanding over 60% of the DeFi Total Value Locked (TVL), totaling approximately $30 billion.

With a robust ecosystem featuring more than 700 protocols as of February 2023, Ethereum has become the preferred choice for developers launching dApps. However, its growth has led to notable scalability challenges, including sluggish network speed and high gas fees, which currently pose significant obstacles. The implementation of The Merge however has set the groundwork for future upgrades aimed at mitigating these issues.

In contrast, Ethereum Classic positions itself as 'Bitcoin, but with smart contracts,' embodying Bitcoin's governance and economic principles while steadfastly adhering to immutability. Despite these merits, Ethereum Classic confronts its own set of challenges. Security concerns persist, particularly regarding 51% attacks, a shared problem for PoW blockchains. The network faced a loss of developer confidence following a series of such attacks in 2020.

Moreover, the PoW consensus mechanism, while tried and tested, raises environmental sustainability concerns due to the energy-intensive mining process. Similar to Ethereum, Ethereum Classic grapples with scalability limitations, handling only 12 to 15 transactions per second (tps), potentially impeding its competitiveness in a market increasingly valuing speed and scalability. The smaller and less vibrant ecosystem of Ethereum Classic, marked by fewer developers and a lower market cap, further compounds its challenges. The DeFi TVL stands at $354,000, supported by only five protocols at the time of writing. However, the aftermath of The Merge witnessed a surge in Ethereum Classic's hashrate by 280%, reflecting a notable influx of miners to the blockchain.

Ethereum Vs Ethereum Classic - FAQ

Is Ethereum or Ethereum Classic better?

Ethereum Classic emerged as a consequence of a programming update to the Ethereum blockchain triggered by a hacking incident in 2016. Presently, both blockchains continue to function, however Ethereum has experienced a remarkable surge in both price and market capitalization, far surpassing the growth observed in Ethereum Classic.

Is Ethereum Classic worth buying?

The latest Ethereum Classic price forecast anticipates a 5.86% uptick, projecting a value of $23.12 by December 12, 2023.

Technical indicators suggest a Neutral Bullish market sentiment of 61% for Ethereum Classic.

Additionally, the Fear & Greed Index currently registers a score of 74, indicating a prevailing sentiment of Greed among market participants.

Is ETC the same as ETH?

There are several differences between Ethereum and Ethereum Classic, as since both are two separate blockchains, each has its own native token: ETH and ETC, respectively.

Why do people use Ethereum Classic?

Ethereum Classic possesses inherent value due to its status as a Proof-of-Work blockchain, coupled with a fixed monetary policy and the inclusion of smart contracts.

These distinctive features contribute to its significant worth, offering key advantages such as genuine decentralisation, the stability of the monetary system, and a high degree of programmability.

Why are there two Ethereums?

Back in 2016, a hacking incident prompted a hard fork of the original blockchain, leading to the bifurcation of the Ethereum project into two separate entities. Those who remained loyal to the unaltered, original blockchain became part of Ethereum Classic, essentially preserving the initial Ethereum in its untouched form and giving rise to a new coin.

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