Almost six years ago, in July 2016, the Ethereum hard fork was used to solve the infamous DAO hack. This particular fork split the chain into two factions, and a new crypto asset called Ethereum Classic was introduced to the crypto community. The two chains have coexisted for years using the same proof-of-work (PoW) consensus algorithm, and with the arrival of Merge, speculators believe that Ethash PoW miners will transition to Ethereum Classic mining. Over the past two weeks, Ethereum Classic has gained more than 124% against the U.S. dollar, and the network’s hash rate has also surged.
Ethereum Classic posts triple-digit gains in last two weeks
Ethereum Classic (ETC), which turns 6 this month, has made some notable progress in the past 14 days. In fact, since The Merge’s scheduled date was announced, ETC has risen in value along with its counterpart Ethereum (ETH).
While ETH saw a notable double-digit gain of 45.7% in two weeks, ETC gained 124.2% over the same period. Despite a 124% year-to-date gain, ETC is still down 34%, about 80% below the crypto asset’s all-time high of $167 per unit.
ETC shares the same consensus algorithm as ETH, and it seems that PoW miners who used to mine Ether are starting to transition and are now mining on the ETC chain. In mid-July, when the preliminary merge date was written, ETC’s hash rate was 17.39 terahertz per second (TH/s), and today it’s up 20% to 20.88 terahertz/s.
ETC hit a high of 21.41 TH/s this week, and the network is also close to its all-time high set last year. On May 7, 2021, the all-time high computing power of ETC was 28.53 TH/s, and the block height was 12,695,074. At the rate at which the Ethereum Classic hash rate is developing, there is a good chance that the hash rate will surpass its all-time high in the near future.
South Korean won accounts for more than 20% of Ethereum Classic transactions
The average fee for ETC is much cheaper than the average fee for ETH, as the average ETH fee today is 0.002 ETH or $3.31, while the average ETC fee is 0.000096 ETC or $0.0031 per transfer. Tether (USDT) is the largest trading pair for ETC as the stablecoin accounts for 59.17% of all transactions today. Following USDT is the Korean Won, which accounts for 20.82% of all ETC transactions, and the USD is the third largest trading pair for ETC, accounting for 7.84%.
11.53% of South Korean exchange Bithumb’s trading volume comes from ETC swaps, and 22.96% of Upbit’s trading volume also comes from ETC against South Korean Won (KRW). When it comes to decentralized finance (defi), the Ethereum Classic network is well behind eight balls in defi development.
Ethereum (ETH) has the most value locked of any blockchain today, with a total value locked (TVL) of $56.62 billion. This is more than 65% of the $87.56 billion locked in the myriad blockchains that support the Defi protocol. Meanwhile, according to statistics from defillama.com, Ethereum Classic’s TVL is very small, at just $175,483 on July 27.
Compared with Ethereum’s 523 protocol, there are three ETC defi applications in total. Over 92% of the locked value in the ETC defi application is held on Hebeswap, an automated token exchange. The rest of ETC’s defi TVL or just $12,366 is kept on Etcswap and Swap Cat.
If miners continue to find value in ETC’s PoW security, then ETC-based defi protocols and smart contract applications may see more development. The supply cap of ETC is also set at 210,700,000, while the supply of Ethereum is unlimited. Today, there are 136,026,596 ETC in circulation, which means there are only 74,673,404 ETC left to mine.
The Ethereum (ETH) network and community is in every way much larger than the Ethereum Classic (ETC) ecosystem, and ETH is a behemoth compared to ETC in terms of market cap. ETH is the second-largest cryptoasset by market cap, accounting for 17.7% of the $1 trillion crypto economy, worth $193.36 billion. On the other hand, ETC accounts for 0.402% of the crypto-economic value, which is currently $4.39 billion.
What do you think of ETC’s recent price surge and hash rate climb? Are you expecting Ethereum miners to transition to the Ethereum Classic chain? Let us know what you think about this topic in the comments section below.
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