Ethereum Classic (ETC) has experienced a remarkable rally over the past two weeks, surging more than 124% in price while its network hashrate climbed 20%. The surge comes as the Ethereum network gears up for its long-awaited transition to proof-of-stake (The Merge), prompting a wave of ETH miners to seek alternative proof-of-work chains — with ETC emerging as the primary beneficiary.
Price and Hashrate Soar Amid Merge Fears
Data shows that ETC's price jumped from around $20 in mid-July to $45, a 124.2% increase in just 14 days. Year-to-date, however, ETC is still down 34% and roughly 80% below its all-time high of $167. Meanwhile, the network's hashrate rose from 17.39 TH/s to 20.88 TH/s, peaking at 21.41 TH/s during the week — approaching the all-time high of 28.53 TH/s recorded on May 7, 2021. If the current pace continues, ETC could soon surpass that record.
Korean Won Dominates ETC Trading
On the exchange front, Tether (USDT) remains the largest trading pair for ETC, accounting for 59.17% of all trades. However, the Korean won (KRW) has emerged as a significant force, capturing 20.82% of ETC trading volume — well ahead of the U.S. dollar's 7.84% share. South Korean exchanges Bithumb and Upbit have seen ETC trades represent 11.53% and 22.96% of their respective total volumes. The cheap transaction fees on ETC (averaging just $0.0031 per transfer compared to Ethereum's $3.31) are also attracting users and miners alike.
DeFi Ecosystem Lags Despite Mining Migration
Despite the price and hashrate boom, ETC's DeFi ecosystem remains negligible. The total value locked (TVL) on Ethereum Classic stands at a mere $175,483, spread across just three protocols: Hebeswap, Etcswap, and Swap Cat. Hebeswap alone accounts for over 92% of that TVL. In stark contrast, Ethereum hosts 523 DeFi protocols with a combined TVL of $56.62 billion. However, as more PoW miners migrate to ETC, the network's security may improve, potentially attracting developers to build smart contract applications. Additionally, ETC has a fixed supply cap of 210.7 million coins, with 136 million currently in circulation. This deflationary model contrasts with Ethereum's uncapped supply and could provide a long-term value proposition.
In summary, ETC's recent rally is heavily driven by the Merge narrative and the expectation of a mass miner migration. Whether the asset can sustain its momentum will depend on the development of its DeFi ecosystem and the long-term commitment of miners after Ethereum completes its transition to PoS.