The recent surge in cryptocurrency markets, sparked by the U.S. Securities and Exchange Commission’s (SEC) approval of spot Bitcoin exchange-traded funds (ETFs), has sent shockwaves across the digital asset landscape. While Bitcoin initially dipped after the announcement due to pre-launch selling pressure, Ethereum (ETH) has responded strongly—gaining over 16% in a matter of days and solidifying its position as the top year-to-date performer among major cryptocurrencies by market capitalization.
But the real standout in this latest market movement isn’t Ethereum itself—it’s Ethereum Classic (ETC). The often-overlooked blockchain, a legacy fork of the original Ethereum network, has seen its native token spike nearly 50% in just 24 hours, far outpacing ETH’s gains despite limited fundamental catalysts.
Why Is Ethereum Classic Suddenly Soaring?
At first glance, ETC’s sudden rally appears disconnected from any major technical or ecosystem development. There are no recent protocol upgrades, major partnerships, or surge in on-chain activity to justify such a sharp price increase. However, timing and market psychology offer a compelling explanation.
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The approval of spot Bitcoin ETFs has reignited speculation that spot Ethereum ETFs may be next on the SEC’s radar. As institutional interest grows and regulatory clarity improves, traders are positioning themselves early—not just in ETH, but across related assets. In this environment, Ethereum Classic, due to its name recognition and historical link to Ethereum, has become an unintended beneficiary of the broader "Ethereum narrative."
While ETC operates independently from Ethereum and uses proof-of-work consensus (unlike Ethereum’s current proof-of-stake model), its branding makes it a psychological proxy for investors looking to gain leveraged exposure to Ethereum-related momentum without directly investing in ETH.
Ethereum Classic’s Post-Merge Resilience
Following Ethereum’s transition to proof-of-stake in September 2022—the so-called "Merge"—many expected Ethereum Classic to absorb a significant portion of displaced GPU miners. And indeed, ETC’s hashrate surged to all-time highs as former ETH miners redirected their hardware toward more profitable proof-of-work chains.
Despite this influx of mining power, Ethereum Classic has maintained relatively low transaction volume—processing around 30,000 transactions per day, comparable to Bitcoin Cash. For context, Litecoin handles over 500,000 daily transactions (aided by its own version of NFT-like inscriptions), while Ethereum mainnet processes roughly twice that amount.
Still, ETC retains a notable share of mining interest. It currently holds less than 15% of Ethereum’s pre-Merge hashrate but significantly outpaces ETHPoW, another Ethereum fork created during the Merge to preserve proof-of-work. ETHPoW now commands only about one-tenth of ETC’s current hashrate, underscoring ETC’s staying power in the niche proof-of-work ecosystem.
Grayscale Exposure and ETF Speculation
One factor that may be amplifying investor confidence in ETC is its inclusion in Grayscale’s product suite. The firm already offers the Grayscale Ethereum Classic Trust, providing institutional and retail investors with regulated exposure to the asset. With Grayscale recently converting its $29 billion Bitcoin Trust into a spot ETF, speculation is growing about whether other Grayscale trusts—including those for ETC—could follow suit.
However, the likelihood of a dedicated Ethereum Classic ETF remains extremely low. Unlike Bitcoin or even Ethereum, ETC lacks widespread adoption, developer activity, or clear utility beyond its role as a proof-of-work alternative. Major financial institutions are unlikely to prioritize ETC for ETF consideration unless there's a significant shift in network fundamentals or demand.
That said, crypto markets have a history of defying logic. As one trader put it: "Stranger things have happened."
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Short-Term Gains vs. Long-Term Viability
While ETC’s 50% rally is impressive, it highlights a broader trend in crypto markets: illiquid assets often experience exaggerated moves during periods of high sentiment. With lower trading volumes and fewer holders, coins like Ethereum Classic are more susceptible to rapid price swings driven by speculation rather than fundamentals.
This phenomenon is sometimes referred to as “dumb money” chasing narratives or traders “front-running the media cycle.” In this case, the narrative is simple: Bitcoin ETF approved → Ethereum ETF coming → Anything with 'Ethereum' in the name goes up.
For now, ETC has ridden the wave better than most—even outperforming ETH in the short term. But sustained growth will require more than just name association. Real adoption, developer engagement, and use cases are needed to transform ETC from a speculative play into a lasting blockchain platform.
Frequently Asked Questions (FAQ)
Why did Ethereum Classic (ETC) increase by 50% suddenly?
The surge appears primarily driven by market speculation following the SEC’s approval of spot Bitcoin ETFs. Investors are anticipating similar approvals for Ethereum ETFs, leading them to buy related assets like ETC due to its name and historical connection to Ethereum.
Is Ethereum Classic the same as Ethereum?
No. Ethereum Classic is a separate blockchain resulting from a 2016 hard fork of the original Ethereum chain. While both started with similar codebases, they now operate independently—Ethereum uses proof-of-stake, while ETC remains proof-of-work.
Could Ethereum Classic get its own ETF?
Currently, the chances are very low. ETF approvals require strong liquidity, regulatory compliance, and institutional interest—none of which ETC currently possesses at the scale seen with Bitcoin or Ethereum.
What happened to Ethereum miners after the Merge?
After Ethereum transitioned to proof-of-stake, many miners shifted their GPU rigs to other proof-of-work chains. Ethereum Classic saw a significant hashrate boost as a result, though activity has since stabilized.
How does ETC compare to ETHPoW?
ETHPoW was created during the Merge as an alternative proof-of-work Ethereum chain but has failed to gain traction. Today, it holds only about 10% of ETC’s hashrate, indicating weaker miner support and community engagement.
Should I invest in Ethereum Classic based on this rally?
Short-term price movements don’t guarantee long-term success. While ETC’s rally reflects current market sentiment, potential investors should evaluate its fundamentals—including limited transaction volume and minimal developer activity—before making decisions.
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Final Thoughts
The recent pump in Ethereum Classic underscores how quickly sentiment can drive value in crypto markets—especially in lesser-known assets with thin liquidity. While the SEC’s ETF decisions have created legitimate momentum for digital assets, not every coin benefiting from the hype has the infrastructure or adoption to sustain it.
For traders, ETC’s surge offers a textbook example of narrative-driven volatility. For long-term investors, it serves as a reminder: price action alone isn’t a strategy.
As the market evolves and institutional participation deepens, assets with real utility and strong ecosystems will ultimately prevail. Whether Ethereum Classic can build beyond its legacy status remains to be seen—but for now, it’s enjoying its moment in the spotlight.
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