Ethereum Classic (ETC) Defies Market Trend Ahead of Halving
Ethereum Classic (ETC) moved up more than 22% during the weekend, rallying to above $36. The token, which has been neglected for months, still sits much lower than its peak prices close to $200. ETC rallied to $38.97 in the new week.
ETC spiked while Bitcoin (BTC) was still hovering under $42,000 and ETH stabilized above $2,800. In the short term, a more significant value was expected if ETC broke above the $39-$40 resistance.
A rally of ETH toward $3,000 may also boost ETC. This time, the price increase was viewed as a buy signal, with bullishness in the coming months. ETC is a highly liquid token with big exchange representation, and a potential to grow to a much higher tier.
However, ETC has managed its third significant rally in the past three months. The immediate reason for the latest price appreciation is the upcoming halving of the block reward.
The exact time of the halving was delayed due to a slowdown in block production, but the event was expected at some point in March.
This time, the rally set up expectations for ETC to touch new all-time highs, as bullish attitudes are slowly returning.
Where is ETC Going
ETC peaked in May 2021, following the price record of Ethereum (ETH). ETC is often moving alongside the original network from which it forked in 2016.
Now, the short-term expectations are for another breakout to a higher range, if the current rally is not cut short. The pressure to phase out mining on Ethereum’s blockchain and replace it at least partially with staking may move miners to the Ethereum Classic network, with heightened interest expected in the next two quarters.
Optimistic predictions, suggestive of a mid-year bull market, see ETC climbing to $300-500, with $1,000 at the more extreme range. ETC has lagged behind the success of ETH, at one point constrained by attacks against the network and a minimal number of nodes.
Is the Ethereum Classic Network Growing
In 2021 and 2022, multiple new networks cropped up as tools for programmable tokens and decentralized apps. Ethereum was losing users due to overwhelming complexity, too many transactions and a long blockchain history that became prohibitive even to miners to hold.
Ethereum is thus highly dependent on the Infura node, and most distributed apps make a call to that service.
However, it is still early to say if the Ethereum Classic network can replace ETH. The current demand for speed may be a problem, since most Ethereum Classic services call for multiple confirmations, making even a single transaction take hours. The ETC transfers have to go through this process to avoid double-spending, where a malicious actor has taken over more than 51% of the hashrate.
Still, the ETC hash rate has picked up from around 7 TH/s to more than 20 TH/s, making it more expensive to attack the network. This sets some expectations Ethereum Classic may start hosting distributed apps and compete with newer networks, while still offering mining rewards and lower fees.
Currently, ETC is one of the bigger winners since the start of 2021, though this may be a short-term price anomaly. ETC follows on a series of altcoin rallies, most of which lasted for about a day before the coins returned to their previous price. Recent altcoin rallies included Monero (XMR) and Decred (DCR).
What Projects Use Ethereum Classic
The Ethereum Classic blockchain already has its own copy of the Bored Ape collection. While this set of NFT items is not as hot as the one on Ethereum, it is still a sign the blockchain attracts projects and may increase its adoption.
However, ETC is not listed among carriers of multiple apps on DappRadar. Currently, the network has 616 active nodes and more than 94M wallets created. ETC is available through MetaMask, and has already sparked the creation of an NFT market similar to OpenSea.
Even at prices above $36, the lower fees and still low prices mean NFT avatars are more accessible and just starting out to gain value.
ETC is available on the Coinbase brokerage, as well as the Binance International exchange, with liquidity on par with bigger, older assets. ETC has been considered risky, but not a “dead token”, as the asset has staged several rallies and keeps attracting miners.
At current prices, Ethereum Classic mining requires relatively small hashing capacity, but potential earnings as high as $378 per month, or higher if the token appreciates. With a 500 MH/s rig, a miner joining a pool can expect to mine about 155 ETC per year.
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