Ethereum Classic undergoes its fourth halving, reducing block rewards to 2.56 ETC, with minimal market reaction.

Ethereum Classic Halving: Key Developments

On May 31, 2024, the Ethereum Classic network successfully underwent its fourth halving. This significant event saw the reduction of block rewards from 3.2 ETC to 2.56 ETC. Occurring at block height 20,000,001, the halving has since led to the processing of 1,362 blocks.
Ethereum Classic follows a biennial halving schedule, reducing block rewards by 20% each time. The next halving is anticipated in 2026, which will further reduce the block rewards to 2.048 ETC.

Market and Network Reactions

Interestingly, the cryptocurrency ETC exhibited a muted response to the halving. While the coin’s price surged briefly on May 30, 2024, it quickly reversed, resulting in a nearly 9% drop on the weekly chart.
Similarly, the hash rate of the Ethereum Classic network, which had increased on May 28-29, displayed a downward trend post-halving, settling at 177.99 EH/s by May 31.

Technical Insights and Future Expectations

Unlike Ethereum, which transitioned to a Proof-of-Stake consensus mechanism, Ethereum Classic continues to operate on the Proof-of-Work model. This distinction has maintained a loyal user base, especially among those who prefer traditional mining methods.
The anticipation of Ethereum’s shift to Proof-of-Stake had previously boosted ETC’s price and network activity, reflecting the market’s divided sentiment towards such changes.

Conclusion

The recent halving in the Ethereum Classic network underscores its continued commitment to the Proof-of-Work mechanism. Despite the lack of significant market response, the reduction in block rewards is a crucial step in the network’s long-term sustainability strategy. As the next halving approaches, stakeholders will be watching closely to see how these changes impact the broader cryptocurrency market.