Tanya Abrosimova
Independent Analyst
- Ethereum Classic is in danger of losing trust due to the repeated 51% attack.
- ET/USD regains ground above $7.00, but the bearish sentiments are still strong.
Ethereum Classic (ETC) attempted a recovery to $7.35 on Wednesday, but failed to hold the ground and dropped below $7.00 in a matter of minutes. By the time of writing, ETC has recovered to retreated to $7.10. The coin dropped below has lost nearly 2% since the start of the day, however, it is still above the critical $7,00, which is a positive signal for the bulls. Ethereum Classic take the 25th place in the global cryptocurrency market rating with the current capitalization of $824 million.
A second 51% attack on the Ethereum Classic blockchain may erode the trust in the project unless the team comes up with a viable solution to avoid similar situations in the future.
Ethereum miner Bitfly reported that order and contents of over 4,000 blocks were shuffled around during the weekend. The hackers managed to double-spend ETC worth of $5,6 million, while the cost of the attack amounted to $204,000. That’s what they spent to get enough hash power to launch 51% attack.
Vitalik Buterin, a co-founder of Ethereum, suggested that Ethereum Classic should change the consensus mechanism to Proof of Stake to reduce the risks of double-spend attacks.
ETC should just switch to proof of stake. Even given its risk-averse culture, at this point making the jump seems lower-risk than not making it.
ETC/USD: Technical picture
On the intraday charts, ETC/USD recovery is capped by a combination of 1-hour SMA50 and SMA100 on approach to $7.20. Once this barrier is out of the way, the upside momentum may gain traction with the next focus on the recent recovery high of $7.35 and $7.40 reinforced by the upper line of the 1-hour Bollinger Band.
ETC/USD 1-hour chart
-637323023042485510.png)
On the downside, the local support is created by the psychological $7.00 reinforced by 200-daily SMA. A sustainable move below this area will worsen the short-term technical picture and bring 100-day SMA at $6.50 into view.
ETC/USD daily chart
-637323023197643729.png)
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended Content
Editors’ Picks
Ethereum continues hinting at rally following reduced long liquidations
Ethereum has continued showing signs of a potential rally on Tuesday as most coins in the crypto market are also posting gains. This comes amid speculation of a potential decline following FTX ETH sales and normalizing ETH risk reversals.
HBAR price jumps 75% as BlackRock tokenizes Money Market Fund on Hedera
Archax, Ownera and The HBAR Foundation have enabled the first tokenization of BlackRock’s money market fund (MMF) on Hedera. Last year Hedera Council member abrdn’s successfully tokenized its MMFs on Hedera.
Bitcoin price holds above $66K as Morgan Stanley files prospectus to add BTC ETF exposure in two of its funds
Bitcoin (BTC) price remains range-bound, holding above the $63,000 level, while its upside is capped below $68,000, going against or delaying the assumption that the fourth halving would be a 'sell-the-news' outcome.
Crypto community reacts as BRICS considers launching stablecoin for international trade settlement
BRICS is intensifying efforts to reduce reliance on the US dollar after plans for a stablecoin effort surfaced online on Tuesday. Most people expect the stablecoin to be backed by gold, considering BRICS nations have been accumulating large holdings of the commodity.
Bitcoin: BTC post-halving rally could be partially priced in Premium
Bitcoin (BTC) price briefly slipped below the $60,000 level for the last three days, attracting buyers in this area as the fourth BTC halving is due in a few hours. Is the halving priced in for Bitcoin? Or will the pioneer crypto note more gains in the coming days?