Ethereum Classic Up 75% in 8 Days, But Will ETH Miners Migrate After ETC ‘Fifthening’?

The price of Ethereum Classic (ETC) climbed on March 22, ignoring a deadly “death cross” on the weekly chart, as traders raised their bets on its potential to become a haven for miners fleeing the rival Ethereum blockchain.

The price of ETC rose more than 15.5% to reach $44 per token for the first time since December 9, 2021. The currency’s intraday gains came as part of a broader rebound move with the price nearly rising more than 75% eight days after its low. $25.

ETC/USD daily price chart. Source: TradingView

Most of ETC’s course towards the positive saw it following general crypto market trends. For example, the Ethereum Classic token showed an extremely higher correlation with Bitcoin (BTC), the leading cryptocurrency by market cap, reaching 0.98 multiple times.

A correlation coefficient of 1 between the two assets shows that they move completely in lockstep.

ETC/USD vs BTC/USD correlation coefficient. Source: TradingView

But ETC’s more than 75% gains in the past eight days have largely outperformed BTC’s 15.5% returns over the same period. That may be related to speculation about Ethereum Classic’s ability to attract miners from its rival Ethereum.

A “Viable Alternative” for Ethereum Miners?

However, Ethereum Classic did not attract that many users by comparison, leaving the network in the hands of few miners. This resulted in a $1 million double spend attack on Coinbase in January 2019 and other cases of 51% attacks on the network.

In December 2020, Cardano founder Charles Hoskinson later announced that his company, IOHK, started the Mantis project to upgrade Ethereum Classic and support his community.

Last year, the cooperative noted that “the move from Ethereum to Proof-of-Stake and Sharding could disrupt many in the community who prefer PoW and a strong base-layer approach to blockchain security,” adding:

“This is where #EthereumClassic becomes a viable alternative to #Ethereum projects to migrate to.”

As ETC surges in March, the hash rate has not risen to new all-time highs, suggesting miners aren’t jumping over it just yet. Nevertheless, social media has started incorporating the miners’ exodus mantra as evidenced by the tweets below.

And that ETC block reduction

The price of ETC also rose ahead of the third block reward cut, or “fifteen,” which is expected to arrive at block 15,000,000 on April 15, 2022.

In detail, the Ethereum Classic block rewards are periodically reduced by 20% every five million blocks (approximately every 2.5 years), according to the improvement proposal ECP-1017, launched in 2017.

The last such event occurred on March 16, 2020, followed by an increase in the ETC by more than 350% to date.

Related: ETH Price Hits $3K As Major Crypto Fund Adds Over $110 Million Ethereum To Lido’s Betting Pool

Technically, ETC appears oversold as the daily relative strength index rises above 70, a sell signal. The ETC/USD pair is now testing USD 44 as intermediate resistance, a level with a history of strong support between July 2021 and December 2021.

ETC/USD daily price chart. Source: TradingView

As a result, ETC may then correct to its 200-day exponential moving average (200-day EMA) near $37. Conversely, a decisive move above $44 could cause $50 — a psychological resistance level — to be its intermediate. upward target is seen.

The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risks, you should do your own research when making a decision.

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