Ethereum Classic is in trouble but still on the rise. What you should know about the coin that got the attention of Vitalik Buterin?

Ethereum Classic grew by 60% in the second half of July, three times faster than Ethereum. If in the case of Ethereum, the reason for the growth was the news about the upcoming transition to the PoS algorithm, in the case of ETC, its prolonged growth is still difficult to explain.

In this article, we’ll look into some ETC analytics and figure out how to make money on it.

It’s all bad: The network is losing its hash rate

According to experts, the main factor behind the growth of ETC might be the attention of ETH miners, who are now forced to switch to mining ETC.

If that’s the case, Ethereum Classic will remain the only large blockchain with smart contracts running on classic PoW and the Ethash mining algorithm. Analysts have also been waiting for migration of miners to the ETC network due to the specifics of ASIC chips, which are not used anywhere else.

In theory, such migration should strengthen the security of Ethereum Classic, which was attacked a number of times before. Developers of the fork are also counting on the growth of interest from smart contract owners who do not want to migrate to PoS. 

No matter how persuasively the media argue for the future success of ETC, both forecasts are currently not supported by statistics. ETC’s hash rate has been declining since April this year and recently updated its lows. There is no overflow of miners. Although the situation began to improve at the end of July, it is not yet a breakthrough.

 

It’s all bad, part 2: The network is losing developers

ETC developers have also reduced activity to zero. At a recent conference, Ethereum co-founder Vitalik Buterin even had to advertise his competitor, whose creation he had previously repeatedly criticized. In his speech at the annual EthCC conference, the Ethereum creator called ETC “the best network with the PoW algorithm.”

The situation looked so ironic that Buterin had to tell the audience several times that the warm words about Ethereum Classic were not a joke.

Project salvation

However, the creator of the original code was not the only major player who supported the fork.

Antpool, the largest mining pool, allocated $10 million to develop the Ethereum Classic blockchain. The funds will go to independent developers who are willing to solve network performance problems in order to launch products that are attractive to investors. In other words, in saving this non-profit network, developers are literally being hired for money. 

Antpool is affiliated with Bitmain, which recently released a new ASIC miner that runs on the Ethash algorithm. Apparently, the largest hardware manufacturer associated with Antpool has decided to save from collapse the ETH-mining industry, whose miners have spent $15 billion on video cards in the last two years, according to Bloomberg estimates. 

Different people are now rumored to be involved in the Ethereum Classic core team, and the project is expected to be completely rebooted. The $10 million is not expected to be the last investment in Ethereum Classic. 

How does this affect you?

Seeing all this fuss of big players around ETC, many ordinary traders made their conclusions and began to buy the coin on positive expectations. If we add the news factor, where headlines like “Ethereum Classic is a sleeping giant” further fuel the situation, the growth of the asset in the background of objectively negative data becomes more understandable.

Based on the steadily growing trend of ETC throughout the crypto winter, this digital asset is now attractive not only for speculators but also for hedgers, which makes it an ideal option for medium-term investments until the recovery of the cryptocurrency market.