What is Ethereum Classic (ETC)?
- Author
- CRYPTO PORT Editorial
- Published
- Updated
- Reading time
- 6 min
In short
Ethereum Classic is the chain that kept the original ledger when Ethereum split in 2016. After funds were drained from an entity called The DAO, Ethereum itself adopted a change that reversed the transactions; participants who objected continued the unmodified chain. It still runs on Proof of Work.
Key points
- Created by the 2016 split over how to respond to The DAO incident
- Declined to reverse the ledger, on a 'code is law' position
- Retained Proof of Work after Ethereum moved to Proof of Stake
- Suffered majority hash rate attacks in 2019 and 2020
Definition
The original Ethereum ledger that continued without accepting the 2016 transaction reversal, and its native asset ETC.
In 2016, a large amount of ETH was drained from a fund-like smart contract called The DAO by exploiting a flaw in its code. The contract behaved as written, but the losses were large enough that the community debated whether to recover the funds.
A hard fork that nullified the drain was ultimately carried out, and that branch is what is now called Ethereum. Participants who objected — holding that a ledger should stand as recorded rather than be rewritten after the fact — kept running the unmodified chain. That is Ethereum Classic.
Technically it long tracked parts of Ethereum's protocol changes, but when Ethereum moved to Proof of Stake in 2022, Ethereum Classic stayed on Proof of Work. Some GPU miners left with nowhere to go migrated to it as a result.
On a Proof of Work chain, anyone who can temporarily rent a majority of mining power can reverse transactions. Ethereum Classic was hit by attacks of this kind in 2019 and 2020, causing exchanges to lose credited deposits. Higher confirmation requirements and monitoring systems were introduced afterwards.
Watch out for
- · Its hash rate is small relative to Ethereum or Bitcoin, and majority attacks have actually occurred
- · It shares history with Ethereum but not its developer base or application ecosystem; do not conflate the two
- · ETH and ETC use the same address format, so sending to the wrong chain is hard to recover from
Frequently asked questions
Which is the 'real' one, ETC or ETH?
In terms of ledger continuity, Ethereum Classic carries on the original chain, while most developers, users and applications stayed with the forked chain now called Ethereum. It is more accurate to see them as two chains that diverged over principle than to ask which is genuine.