Ethereum Classic is an open-sourced, decentralized, blockchain-based computing platform that executes smart contracts, allowing for permissionless management of digital assets. The Ethereum Classic network is the continuation of the unaltered history of the original Ethereum blockchain, existing to preserve the principle of "Code is Law". Its distributed network consists of a blockchain ledger which supports the native token ETC and supports several dApps and services. 

It calls itself one of the purest decentralized projects in the crypto industry and is backed by several teams, including ETC Consortium, ETC Cooperative, Ethereum Commonwealth, IOHK Mantis, ETC Core, Byzantine Fault, and more. The original Ethereum project saw its mainnet launch in July 2015. However, a year later, the Ethereum Foundation had to create a new version of this mainnet with an irregular state change that erased The DAO theft from its blockchain history. While the updated version of the blockchain went on to be called Ethereum, the original, unaltered version was renamed and continues to exist as Ethereum Classic. 

Its native Ether token is called ETC and has goals similar to that of crypto leader Bitcoin - it is mechanical, algorithmic and capped. The legacy network may not have gone through as many upgrades as Ethereum but enjoys the support of several prominent backers, including CEO at leading digital asset management firm Grayscale, making ETC hard to ignore in terms of its potential as a cryptocurrency. 

ETC Breakdown

Ethereum Classic can run smart contracts, offering several use cases and opportunities for decentralized applications (dApps), especially in the growing DeFi space. While it may not be as popular as the leading DeFi network, Ethereum, it still remains a popular choice for several crypto purists who believe in its vision of originality. However, given that the blockchain has retained its original code instead of rectifying the DAO hack, there are concerns of its security, especially in comparison with the current version of Ethereum and other leading blockchains that can support smart contracts. 

Although it offers smart contract capabilities and can run dApps, the developers behind Ethereum Classic remain committed to maintaining its value as a digital payments method. As a digital store of value, ETC can be saved and exchanged in addition to being used as a fast and cheap way to transfer payments digitally among users and between users and businesses worldwide. 

Ethereum Classic History

Ethereum Classic's blockchain originated in the aftermath of the DAO hack - an Ethereum-based venture fund, in July 2016, which resulted in the loss of around 3.6 million ETH from its ICO funds, valued at around $150 million. In response, the Ethereum Foundation created the present day Ethereum network from a hard fork while the original network exists now as Ethereum Classic. The community backing Ethereum Classic believed that mutability went against the ethos of crypto networks and continues to maintain its principles of censorship resistance and immutability. 

Since then, however, the blockchain has suffered several 51% attacks, most notably the three in August 2020. After the final attack in the month, the network underwent a large reorganization of 7,000 blocks and since then, there has been no double-spend attempt till date. The ETC Cooperative has considered switching the blockchain's hashing algorithm from Ethash to either Keccak-256 or SHA-3, which would prevent such attacks. 

ETC Price Factors

The Ethereum Classic blockchain features a Turing-complete smart contract language that can support the development of more complex dApps in a truly transparent and decentralized manner. What makes ETC unique as an investment is that it is among the few cryptocurrencies that allow investors to gain exposure via traditional brokerage and retirement accounts. 

As we mentioned before, Grayscale CEO's backing of ETC has resulted in the creation of an Ethereum Classic Investment Trust (ETCG) that lets investors exposure to it without actually owning or storing it directly. 

The Ethereum Classic price can be influenced by the adoption of its infrastructure by projects and developers. An uptick in the development of dApps can raise on-chain activity and drive up the ETC rate, and vice versa. 

The Ethereum Classic rate can also be affected by possible network hacks and attacks as it could shake investor confidence in the network. Any more attacks like the 51% attacks suffered last year could cause dApp developers to migrate to other, more secure blockchains and bring down the ETC price. 

In addition, the ETC rate can also be affected by the overall market sentiment - a bullish sentiment towards cryptocurrencies in general can drive more investors to buy the token. On the other hand, a bearish sentiment owing to worries about regulation or other concerns can cause investors to sell-off their ETC holdings and drive its price lower.  

Trading Ethereum Classic

Ethereum Classic may not rank high in terms of popularity among most investors in the crypto market but could be an interesting alternative for users looking to back relatively unknown instruments. Before you begin trading ETC, spend some time gaining an understanding of how the overall market functions and where Ethereum Classic fits into the whole puzzle that is the world of cryptocurrencies. Look into the history, historical price action and upcoming developments, especially related to news of its adoption among developers and projects to appreciate its potential as an investment opportunity. 

The next step would be to open an account with a reliable crypto exchange or broker which lists ETC among its offerings. Upon successful registration, you can convert your trading capital from fiat currency towards buying ETC. Follow an expert trading signal provider, crypto news website and other sources of information to perform fundamental and technical analysis on ETC price action to determine the best time to buy, sell and hold Ethereum Classic.