Ethereum Classic is an open-source blockchain. The network is based on a distributed computing platform characterized by smart contracts. This cryptocurrency was born as a result of a rebellion against Ethereum’s hard fork update. Its main goal was to retrieve funds from the Decentralized Autonomous Organization after it was corrupted and hacked. The Decentralized Autonomous Organization was a complex smart contract which was developed to revolutionize the way Ethereum worked. It was established to primarily act as a decentralized venture capital which was going to finance all future DAPPS made under the Ethereum platform. However, in June 2016, someone found a loophole in the DAO that allowed him/her to siphon away a third of DAO’s funds, amounting to $50 million worth of Ether. As a result, three potential solutions where proposed including; doing nothing, Soft Fork and Hard Fork.
The primary distinction between soft fork and hard fork is based on backward compatibility. Under soft fork, the choice of whether to update your system or not was left on the users. Regardless of the choices made by the users, they could still interact with each other. This was a resolution aimed at making it difficult for the hacker to transact the stolen ether. However, the soft fork solution turned out to work best for the hackers as this allowed him/her to flood the network with transactions and make miners do endless complex computation. On the other hand, once a transaction is utilized under hard fork, there is no going back. If any user did not upgrade to this version of blockchain, they would subsequently bared from interacting with other users who have upgraded.
People who were opposed to the hard fork stuck with it and ended up calling it Ethereum classic. Since then it has developed a distinct identity that has given it a competitive edge against other cryptocurrencies. Unlike Ethereum, Ethereum classic shows no indication of switching to proof-of-stake mining. There is a growing number of developers in the smart contract community and Ethereum classic seems to be steering towards a radical economic change. The market cap of Ethereum Classic stands at approximately $1.5 billion making it the 5th most expensive cryptocurrency.
Ethereum classic has recently received support from notable companies and people despite the past setbacks. The reason why people mainly decided to stick with soft fork is that hard fork went against the very principles cryptocurrency was invented, to go against financial corruption. Hard fork blockchain system was changing the entire system and defeating the entire purpose of Ethereum. The problem with Ethereum Classic is the lack of backward compatibility which limits the capability of the users. Most of the Ethereum community moved to the new chain meaning that Ethereum Classic users will be limited from any updates. So when ETH moves from Proof-of-Work to Proof-of-Stake, ETC users are locked out as ETCs’ software simply does not allow such updates.
What is Ethereum Classic blockchain? Pros and cons:
|
|
|
