The digital coins have come a long way and if you have been following the market trends, the competition keeps getting steep. Ethereum (ETH) and Ethereum Classic (ETC) battle of supremacy is a classic example of how competitive the market can turn out to be.
Ethereum (ETH) is more established than Ethereum Classic (ETC) but there is more to it than who hit the market first. Ethereum Classic continues to scale the market and recently came to the limelight after being listed on Coinbase exchange in unclear circumstances. Whether the SEC erred or not, one thing is clear; the battle for supremacy has just begun.
Brief Historical facts about Ethereum and Ethereum Classic
Both outfits ride on smart contracts. These are what makes their systems tic. They are automated processes that tie the system together as a way of enforcing contractual agreements. However these led to Ethereum Classic (ETC) breaking away from Ethereum (ETH) to initiate an independent blockchain.
The introduction of the Decentralized Autonomous Organization was a very innovative idea for the future of the original blockchain. Simply put, it was designed to be a decentralized fund repository where all future dApps were to get funding from.
To have a say on which dApp project to get funded, network participants were required to purchase DAO tokens using ETH as the mode of payment. This was also used a proof that you are part of the newly formed DAO family. For any project to be funded, it had to attract 20% of total votes from DAO token holders.
How the Ethereum DAO Play Out?
A total of $150million worth of ETH was raised in less than 30 day crowd sale. Many users had confidence on the ambitious project. However, the approval process is what many people were against. Participants were then given a leeway to create their “smaller DAOs” which saw the entire platform start splitting into two.
There were some loopholes in the entire arrangement and a possible split was evident. This came to happen after many assurances were made that everything was working according to plan. Later the system loopholes became unpreventable thus Ethereum Classic split from Ethereum.
System Loophole led to the DAO Attack
Through the system weak point or loophole, someone took advantage of the lapse and made away with about $50million worth of DAO funds. Those who wished to leave the DAO deal were free to get back their Ether but the coins were stored in a “smaller DAO” when it hit $50million that how the funds disappeared.
After the DAO Attack, what Happened?
After the attack, Ether holders lost trust on the platform and the coin price skydived from $20 to $13. However, with the smart contract arrangement, the $50 worth of Ether stashed in a “small DAO” could not be moved before expiry of 28 days and the only way out was for a split and there were only two options left, a soft fork or a hard fork. A hard fork was the only viable way out and this is how the two blockchains came into being.
The hard fork opponents were left on the original platform while those that were for the hardfork moved to form Ethereum Classic. Their parting ways and exposure to the real world of cryptocurrencies has seen different performances in terms of price and real world use cases; factors that investors look for before staking.
Fast Forward for the Two “Ethereums” Today
After the hardfork, the two blockchains have had challenges but Ethereum is still leading by a market cap of $53.7billion and is currently trading at $535.96 after gaining 2.23% to the dollar. The coin, like many in the market has shed most gains of December-January and still struggling to get back to its former glory. ETH is ranked 2nd by market capitalization.
Ethereum Classic (ETC) has had its fair share of challenges and it is now ranked 17 by market cap that stands at $1.73billion. This shows it has an uphill task to rival the mother outfit. However, the coin has been growing and got a boost a week ago by getting listed on the Coinbase after being declared a no-security.
At the time of reporting, ETC is among the most improved top 20 coins and for the last 24 hours it has gained 10.33% against the dollar and 8.66% to Bitcoin. With the renewed popularity and investor confidence, the coin is set to scale new heights and become a real threat to the original blockchain, Ethereum.
Ethereum (ETH) has been holding on to the second position but there other upcoming coins giving it a run for their money. It allows people to create dApps and other related projects and the future is being challenged by smaller Altcoins who are offering the same services in a better way.
Ethereum Classic (ETC) is less popular and its value cannot be compared to the mother outfit and it has been slow in its growth strategies and has lost trust among investors and the growth potential options seem to be limited; at least for now.