Traders Are Turning ETC Into the Next Dogcoin

Three major reasons have helped ETC take off.

Traders Are Turning ETC Into the Next Dogcoin

Ether Classic (ETC) hit an all-time high of $38 on April 15, but it soon traded above $100 on Robinhood and Coinbase, and surprisingly, ETC traded at $150 on Coinbase on May 6.

Cryptocurrency markets tend to change dramatically overnight, like Ether Classic (ETC), which has surprised many in the industry as its price has soared. According to Nomics data, ETC price reached a high of $38.43 last week on April 15, only to unexpectedly break through the $100 resistance level just a week later, to $91.45 at the time of writing according to the latest Coingecko data, a 7-day gain of 160.7%.

It’s worth noting that ETC price information varies across cryptocurrency exchanges, for example, it jumped to $149.75 on Coinbase before dropping to the $127 range, which is $35 higher than Binance and $12 higher than Robinhood.

While the large spread is short-lived, the price increase is undeniable. There are three possible triggers for this to happen.

  1. The overall cryptocurrency market is in a “bullish” phase
  2. ETC is available on several well-known trading apps
  3. Significant changes in the competition chain

Ether Classic, a product of the 2016 ethereum blockchain fork, saw 3.6 million ETH (worth about $50 million at the time) tokens stolen following a smart contract with decentralized venture capital project The DAO. This incident led to two very different approaches in the ethereum community – most stakeholders wanted to intervene and change the blockchain’s code to retroactively eliminate the theft, while the other part of the community that was not affected did nothing, arguing that the blockchain protocol could not be changed just because tokens were stolen.

Due to the huge and irreconcilable community conflict, the developers struggled and eventually the anti-intervention camp chose to fork and continue using the original Ether blockchain – and that, in turn, is now known as Ether Classic (ETC).

For years, Ether Classic has seemed to be in a state of disarray. Throughout 2019 and 2020, the ETC token price has never exceeded $13, while the ETH price has never dipped below $100 in the same timeframe.

But now, as demand for cryptocurrencies like Dogecoin, Bitcoin Cash and EOS continues to grow, ETC is starting to have its “good days”. Will Foxley from cryptocurrency mining company Compass Mining said.

“The price of many crypto tokens has spiked dramatically in recent times, and the profitability of mining ethereum and ethereum classic tokens is now essentially the same. Considering what Ether Classic was like about a year ago, it’s remarkable how the ETC token price is moving today – there’s no doubt that Ether Classic has been freed from multiple 51% attacks, weak app traction and a split in the core development team.”

But why can Ether Classic win the “turnaround”? There are three main reasons.

First, unlike dogcoin, ETC prices have actually been undervalued for a long time. Federal Reserve Chairman Jerome Powell said last week about Dogecoin, which has risen from $0.01 to $0.62 this year despite being a joke, that “some asset prices have been pushed very high.”

Powell believes that what you see in the capital markets can indeed be somewhat of a bubble. A bubble is actually a technical term indicating that a certain price level is unsustainable, as a bubble occurs when the price is higher than the intrinsic value of the asset. But that’s not the case with Ether Classic, and ETC prices have actually been undervalued for a long time in terms of historical data.

Secondly, the surge in ETC prices may also be attributed to three major cryptocurrency exchanges: Binance, Coinbase and Robinhood, with Binance being the largest cryptocurrency exchange in the world, and Robinhood and Coinbase being the largest cryptocurrency exchanges in the world. Binance is currently the largest cryptocurrency exchange in the world, while Robinhood and Coinbase are the most popular portals for cryptocurrency “geeks”, both of which are focused on constantly improving the buying/selling user experience and ease of use. Notably, Robinhood and Coinbase have become the #1 and #3 apps on the Apple App Store – ahead of TikTok, YouTube, and Instagram. In the case of Robinhood, the trading platform only supports trading Bitcoin, Bitcoin Cash, Dogcoin, Ether, Litecoin, and …… ethereum classic. There is no doubt that with the support of these exchanges, ETC prices could easily shoot up to high levels.

Third, technical reasons may also be at play. Currently Ether still uses proof-of-work consensus, and computers connected to the blockchain need to solve extremely difficult cryptographic puzzles to protect the network and earn ETH tokens. But soon, Ether will transition to the proof-of-stake consensus-based Ether 2.0 blockchain, which will eliminate the traditional energy-intensive ETH mining that has made many miners “uneasy. However, Ether Classic has no plans to transition from a proof-of-work algorithm to a proof-of-stake algorithm, which means that ETH miners may want to continue to use hardware mining on the ETC blockchain. On the other hand, the EIP 1559 proposal, which will be implemented in the July upgrade before EtherChip moves to the new EtherChip 2.0 blockchain, will also result in significantly lower rewards for miners, so many miners may “switch” to EtherChip Classic.

Will Foxley adds.

“It will be interesting to see if the price of Ether Classic remains stable now, especially as the Ether ecosystem moves closer to deploying the EIP 1559 and ETH 2.0 upgrade ‘merger’. At that point, if ETC prices can continue to rise, Ether Classic could become a whole new lifeline for traditional capital-intensive GPU miners.”

Posted by:CoinYuppie,Reprinted with attribution to:
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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