Ethereum Hard Fork Creates Competing Currencies

The Ethereum hard fork executed last week as a means of reimbursing investors who lost funds in the collapse of a major project has resulted in the creation of a competing currency on a blockchain replicating the platform's original consensus rules prior to the fork.

Announced last week, a project called Ethereum Classic is continuing to mine a version of the blockchain in which funds were never restored to investors in The DAO. As observed here, the Ethereum Classic blockchain is now approximately 4,000 blocks behind the ethereum blockchain supported by ethereum's original developers and community members.

Earlier today, Poloniex, long the largest exchange for ethers, the digital currency native to the ethereum blockchain, added support for the native token running on the Ethereum Classic blockchain, called classic ether.

"The structure and governance of ethereum created instability and preconditions violation of its blockchain characteristics. Creating the Ethereum Foundation and all the corporate trappings around ethereum was a grave mistake."

Those behind the effort state they reject the reasoning behind the ethereum hard fork, with Arvicco likening it to a "Bailout" for investors in The DAO. The hard fork was launched after a community vote that suggested support for the measure it has become highly criticized for perhaps lacking a necessarily broad representation of ethereum stakeholders.

Complicating matters is that some in the ethereum community appear to be adopting a hostile stance toward the Ethereum Classic project.

Still, to build long-term value, Ethereum Classic's developers will need to establish their platform as one that offers advantages to those wanted to build decentralized applications using the ethereum platform.

Ethereum Classic plans to follow the original roadmap released by ethereum's developers, which would include upgrading its blockchain to support future hard forks meant to provide additional functionality.

At press time, at least one major ethereum developer appears to be supportive of the effort, or at least an open community evaluation of Ethereum Classic.

Original Ethereum CTO and its original C++ developer Gavin Wood said via Twitter that his startup Ethcore is he was working on a version of Parity that would support Ethereum Classic.