Comparison of Ethereum dual-chain mining trends, ETH performs better than ETC

About the author: Michael Wuehler is a member of Ethereum startup ConsenSys and the founder of the Ethereum NYC meetup. In his opinion, Ethereum (ETH) is not like most other crypto tokens. Its underlying value (computing power) is not very correlated with the price of the coin, but is more related to the development of the platform itself. The correlation between the computing power and the price of the coin of another fork chain of Ethereum, ETC, is even greater.

Over the past month, I have been recording the hashrate of the Ethereum (ETH) and Ethereum Classic (ETC) networks. I did this mainly because I was curious about the impact of hashrate on the development trend of each chain and the price of each token. My view is that ETH is not like most other crypto tokens, and its underlying value is not very correlated with the price of the coin, but more related to the development of the platform itself. To prove my point, I tracked the performance data of the ETH and ETC networks in the past month.

As shown in the figure below, it is the computing power performance of the ETH network and the ETC network, which clearly shows a trend.

(ETH) hashrate vs. (ETC) hashrate [Time: July 29, 2016 - September 3, 2016]

Slacknation published an interesting chart comparing the price and hashrate of ETC/ETH. The chart clearly shows that there is a strong correlation between the price of the coin and the hashrate ratio of ETC/ETH. I personally believe that the fluctuation of ETC hashrate is mainly due to the transfer of hashrate to ETC by large miners for profit, but I have no data to support this statement, so I will not discuss this issue for the time being.

It should be pointed out that the chart provided by slacknation only shows data for one week, and such a data sample is obviously not very representative. The chart below shows the ETC/ETH computing power ratio data for a whole month.

Now, instead of comparing the computing power ratio, let’s simply compare the performance of the two coin prices during the same period.

Through observation, it is obvious that the price of ETC is strongly correlated with the ETC computing power and the ETC/ETH computing power ratio.

So how is ETH performing?

The price of ETH is basically the same as a month ago, but the computing power has increased from 4,137 GH/s at that time to 4,941 GH/s, a growth of 19.4%. If the price of ETH is proportional to its computing power, then the price of ETH should be $13.9, instead of the current $11.65.

The data reveals some information to us. Miners who control resources can choose to mine one of the blockchains based on their own value judgment, while miners who choose the ETC chain will be more affected by the price of the token. Miners who choose to mine ETH are not so obvious.

I am personally a supporter of the ETH blockchain and firmly believe in the view of the founder of Ethereum: Ethereum is a development platform, not a cryptocurrency for transactions.