The DAO hack was an unprecedented moment in cryptocurrency history, not only due to the nature of the attack itself, but also due to the ramifications it brought. The hardfork was successfully deployed and it is working as it is supposed to, since the refund Smart Contract has been working perfectly and has been returning Ether back to the hands of The DAO token holders. But this hardfork as also spawned a “new” cryptocurrency: Ethereum Classic (ETC).
Despite the majority of votes were made for the implementation of the Hard-Fork, part of the Ethereum community has decided to split from the recent decision and to continue mining in an unaltered blockchain, in which the hard fork never took place and the hacker has the ability to withdraw the stolen funds from his Child DAO on the Ethereum Classic Blockchain.
This new decision has obvious implications for Ethereum and Ethereum casual users who are now, more than ever, confused about the cryptocurrency which was never easy to understand in the first place.
“I hold some ETH with Poloniex and now as stated I see I hold the equivalent in ETC – does this mean if sell ETH I still hold the same in ETC ? This is confusing. Does this also mean that if you buy ETH you automatically buy ETC with Poloniex?”
Questions like this are popping up more and more, as the alternative blockchain gains traction and supporters. But the fact that something can be confusing shouldn’t get in the way of innovation, which isn’t the case since there is no real innovation in ETC, but the real problem is security. The Ethereum Classic blockchain is identical to the Ethereum blockchain up until block 1920000, which means that all the balances and wallets are the same up until that point. Users that make a transaction on either chains are subject to have that transaction replayed on the other chain. This is possible because all the information is the same, so when a user broadcasts a signed transaction on the Ethereum Classic Blockchain, that same cryptographic signature can be used to make a transaction on the Ethereum Blockchain and vice versa.
Ethereum Classic has, since its inception, been added to several mining pools, exchanges and so on, and has been exposed to extreme volatility with a crash of over 80% during the day it was added to poloniex and with a rise of more than 300% during the past day.
ETC is also breaking records when it comes to trading volume, which has actually exceeded Ethereum’s. These are exciting times in cryptocurrency, since what Bitcoin has been trying to avoid for so long has finally become true for Ethereum. We advise users to deal with Ethereum Classic with extreme caution, not because of the currency itself but because of the risks it poses to casual users. If you want to make a transaction in the ETC blockchain, please remove all the funds you have from your Ethereum wallet before doing so, in order to avoid the replay attacks mentioned before.
ETC on Coincheck
Coincheck has decided to add Ethereum Classic to the list of select cryptocurrencies currently available on the platform (BTC, ETH, DAO). Users will be able to easily buy and sell ETC for Bitcoin.