Origins of Ethereum Classic



Site Admin
Apr 2017
The DAO and the Smart Contract

The DAO was an open sourced "Decentralized Autonomous Organization" and a form of investor-directed VC fund. The smart contract's purpose was to act as a decentralized investment fund and to provide a decentralized business model for traditional VC firms. And in May 2016, the DAO was crowdfunded, setting the record for the largest crowdfunding campaign in history.

In June 2016, hackers gained access to 3,600,000 ETH, resulting in one of the largest cryptocurrency heists of all time, causing chaos within the Ethereum community and crashing the price of ETH. It was discovered that the cause of the hack was only a few lines of poorly written code, which was a huge embarrassment for Ethereum, a relatively new cryptocurrency, and raised several questions about future Ethereum-based projects.

Ethereum Classic Hard Fork

In July 2016, the majority of Ethereum holders responded to the DAO hack and voted for a hard fork in the Ethereum blockchain. This hard fork was a manual intervention to restore virtually all funds to the original contract, which could then be withdrawn.

Although the purpose of the blockchain fork was to replace the existing tokens with its forked successor, there were some vocal critics of the move who wanted an immutable blockchain. And they feel Ethereum Classic remains the "original" Ether currency.

Ethereum and Ethereum Classic

Everybody who held Ether before the hard fork held an equal balance of each currency.

Ethereum (ETH) and Ethereum Classic (ETC) are still actively traded today.

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