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Why is Ethereum Classic (ETC) Price Rising Today?

Why is Ethereum Classic (ETC) Price Rising Today?

KEY TAKEAWAYS

In a major news story we have already covered, Ethereum has launched its 10th shadow fork on 27 July, 2022. The process was supposed to be going live on July 28, 2022, however, the event took place a whole 26 hours ahead of time! Now this move sent the token rallying over 15% as on the morning of 28 July, currently trading well over $1600, slowly trying to gain back its lost ground amidst the raging bear market.

Also read: Top Crypto News: Ethereum Mainnet Tenth ‘Shadow Fork’Goes Live 26 Hours Early!

However, another coin which shares the same name was gone quietly unnoticed but has managed to gain much more impressive gains. If we were to consider its rally from 13 July, 2022 – the day the overall market managed to bottom out and began its rally – Ethereum Classic’s token ETC has managed to rise over 200%! Take a look below.

ETC/USD | Source: Tradingview

According to CoinMarketCap, Ethereum Classic had managed to touch over $42.29 as of writing this article, putting it at a near 4-month high, till date. With the oncoming Ethereum Merge halfway through September 2022, it seems like Ethereum Classic investors are all set to gain big!

BUT, WHY IS ETHEREUM CLASSIC RISING SO MUCH?

To understand that, we will need to understand what effect the Ethereum Merge will have on Ethereum Classic. And for that, we will need to do a bit of digging into Ethereum Classic’s past.

Ethereum Classic was created after a hard fork on the main Ethereum blockchain after a DAO on the network was hacked back in 2016. The older, original chain containing the history of the hack on the DAO was renamed to Ethereum Classic, while the new one that was salvaged form the hack, was named Ethereum.

Also read: Ethereum Merge 

So basically, Ethereum Classic still works on the principles of the older generation of Ethereum – and so while the new one will adopt the proof-of-stake consensus mechanism, the older one will continue to operate on the more energy intensive proof-of-work consensus mechanism. Thus, miners working on Ethereum today will be forced to either shut down their mining rigs or switch to other compatible proof-of-work (PoW) networks.

And the most suitable alternative that works out for them is naturally Ethereum Classic. It uses the same consensus algorithm as Ethereum (Et-hash algorithm). In contrast to that, Bitcoin uses the SHA-256 which is not suitable for GPUs built for mining on the Ethereum network. So instead of that being piled up as junk, those mining rigs will essentially be put to work on another network that pretty much works in the same way Ethereum does today, before the Merge.

Thus, Ethereum Classic will become one of the biggest beneficiaries from the Ethereum migration – which is expected to cut off earnings for as many as one million people.

WHO’S GOING TO GAIN FROM THIS?

Thanks to this migration – Ethereum Classic miners who are looking to ramp up their mining capacity can now take advantage of the sale of second-hand GPUs and ASIC miners from Ethereum miners who have decided to turn validators on Ethereum 2.0. This would enable them to achieve a higher hashing power on the network, thus improve their chances of solving a block and gaining the competitive edge.

If we check on-chain metrics for the token, we can already see a huge rise in the hashrate for ETC. It is almost at the highest point in the last three months!

Ethereum Classic Hash Rate | Source: Messari.io

The second positive thing, that we can already see playing out is the price appreciation of the ETC token as miners migrate from Ethereum to Ethereum Classic, and thus leading to more demand for the same token.

Along with that, a bunch of PoW enthusiasts, who still believe in the OG consensus mechanism might also would want to be a part of this growing PoW blockchain network, and could soon become the largest PoW network, with Ethereum possibly out of their way in about two months time.

Additional Read: Ethereum Classic Price Prediction

ETHEREUM CLASSIC PRICE ANALYSIS

ETC/USD | Source: Tradingview

For any technical analysis on Ethereum Classic, we will need to take a slightly longer timeframe look. In our case here, we will take price chart data of roughly a year and a half. So, what that tells is is that Ethereum Classic’s token ETC is at a relatively comfortable position in terms of price. It has managed to recover a large chunk of what it lost amid the raging bear market from the beginning of 2022. Once even in March, it managed to break about the 2022 opening price to touch almost $52 levels.

But currently trading at $33, it is still relatively comfortable to undertake a slow but steady rally hereon. Why do I say so? That is because it is currently trading at hardly 50% below November 2021 highs of about $66-70. Now the wide region between $45 to $75 is a zone of accumulation where ETC can be expected to spend some time to absorb all the selling pressures before resuming rally. That could take a couple of months even.

Once it is able to cross that, we may see another major run up to its actual all-time-highs to over $180, but that is still very very far away. But overall, things seem quite optimistic for Ethereum Classic on the technical front too.

HOW TO INVEST IN ETHEREUM CLASSIC (ETC)

Ethereum Classic (ETC) can be easily bought here on CoinDCX along with the best deals in the market. Just download the CoinDCX App crypto app, enter the details required and wait for your profile to get verified. Once done, fund your wallet and buy Ethereum Classic (ETC).

Prices as of 28th July, 2022


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