The cryptocurrency landscape has been reshaped in ways few anticipated just three months ago. Ethereum Classic (ETC), the continuation of the original Ethereum blockchain that refused to implement the hard fork reversing the DAO hack, has surged to become the sixth-largest cryptocurrency by market capitalization, valued at approximately $119 million as of September 10, 2016. The unexpected rise of ETC raises fundamental questions about immutability, governance, and the true meaning of decentralization in blockchain networks.
TL;DR
- Ethereum Classic has become the 6th largest cryptocurrency with a $119M market cap
- ETC emerged from the original Ethereum chain that refused the DAO hard fork
- The DAO hacker still controls approximately 5% of all ETC tokens (~$7M)
- Ethereum (ETH) remains 2nd largest but is down ~15% from pre-DAO levels at $12.17
- Major exchanges including Poloniex and Kraken have moved to delist DAO tokens
- The debate over “code is law” versus interventionist governance continues to divide the community
The DAO Hack: A Quick Recap
In June 2016, The DAO — a decentralized autonomous organization built on Ethereum that had raised over $150 million worth of Ether in what was then the largest crowdfunding event in history — was exploited through a reentrancy vulnerability in its smart contract code. The attacker siphoned approximately $60 million worth of Ether from the fund, triggering a crisis that would ultimately split the Ethereum community in two.
The response from Ethereum’s leadership, including founder Vitalik Buterin, was to propose a hard fork — an unprecedented intervention that would rewrite the blockchain’s transaction history to reverse the malicious transfers and return funds to DAO investors. The fork was implemented on July 20, 2016, with the support of the majority of miners and the Ethereum Foundation.
The Birth of Ethereum Classic
Not everyone accepted the fork. A faction of the community, self-described as “radical crypto-decentralists,” argued that any forced modification of the blockchain — even to reverse a theft — violated the fundamental principle that “code is law.” They pointed out that the hard fork was partly driven by influential players who had personally invested in The DAO and stood to benefit from the blockchain rollback, raising questions about conflicts of interest.
This dissenting group continued mining the original, unforked Ethereum blockchain. That chain — now known as Ethereum Classic — preserved the DAO hacker’s stolen funds, viewing the immutability of the ledger as sacrosanct. What began as an ideological statement has quickly evolved into a financially significant network in its own right.
ETC’s Surprising Market Performance
The market has responded to Ethereum Classic with surprising enthusiasm. With a market capitalization of approximately $119 million, ETC now ranks as the sixth-largest cryptocurrency, behind only Bitcoin ($9.89B), Ethereum ($1.02B), XRP ($207M), Litecoin ($189M), and Monero ($157M). ETC is trading around $1.42 per token, with a 24-hour gain of 1.22% and a 7-day increase of 5.91%.
The success of ETC presents a curious dynamic. The DAO hacker still controls approximately 5% of all Ethereum Classic tokens — roughly $7 million worth — according to Bitcoin Magazine. This means the attacker stands to profit significantly from the continued value of the original chain, a reality that troubles many in the cryptocurrency community.
Ethereum’s Struggle to Recover
Meanwhile, the forked Ethereum chain — the one most of the community now refers to as simply “Ethereum” — has stabilized but not fully recovered. ETH is trading at approximately $12.17 as of September 10, still down roughly 15% from the levels preceding The DAO’s launch and subsequent hack. While it comfortably maintains its position as the second-largest cryptocurrency with a $1.02 billion market cap, the damage to Ethereum’s reputation as a reliable platform for decentralized applications has been significant.
The protocol, long touted as a more sophisticated successor to Bitcoin, has been battered by the episode. Its most ambitious promise — that code could replace institutions and laws in securing financial arrangements — suffered a serious blow when the community chose to intervene rather than accept the consequences of buggy smart contract code.
DAO Token Delisting
Adding to the fallout, the DAO token itself has been effectively rendered worthless. By September 2016, major cryptocurrency exchanges including Poloniex and Kraken have moved to delist DAO tokens, marking the effective end of what was once the crowning achievement of Ethereum’s smart contract capabilities.
Why This Matters
The Ethereum fork debate represents one of the most significant philosophical divides in the history of cryptocurrency. On one side are those who believe blockchains must remain immutable — that the integrity of the ledger transcends any individual incident, even a $60 million theft. On the other are pragmatists who argue that the technology must serve human interests and that catastrophic bugs demand corrective action.
The coexistence of Ethereum and Ethereum Classic suggests that the cryptocurrency market may be maturing in unexpected ways. Rather than one chain definitively “winning,” both are finding their niches — ETH as the actively developed platform backed by the Ethereum Foundation, and ETC as the principled alternative that prioritizes immutability above all else.
For Bitcoin maximalists, the entire episode serves as validation of Bitcoin’s more conservative approach to protocol development. While Bitcoin has faced its own governance disputes, it has never attempted to rewrite its transaction history — a distinction that proponents argue makes it the only truly decentralized cryptocurrency.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry significant risk. Always conduct your own research before making investment decisions.
ETH at $12.17 when this dropped and people were arguing philosophy. the trade was literally right there and most people chose sides instead of positions
saison_fork_ ETC at 6th place was pure sentiment. once Poloniex listed it the speculation was front-run. anyone buying ETC above $2 was trading narrative not fundamentals
the DAO hacker still holding 5 percent of all ETC tokens and nobody talks about it. thats a 7 million dollar bag controlled by the person who arguably created the chain
the DAO hacker holding 5% of all ETC and the chain surviving tells you crypto markets price risk extremely poorly. thats not resilience thats negligence
ETH at 12 dollars when this happened. people arguing about philosophy while the actual trade was right there. classic crypto
Poloniex and Kraken delisting DAO tokens while ETC surged to number 6. the market was basically saying the original chain had value even if the foundation abandoned it. code is law until it costs you money
ETC at $119M market cap and people were still calling it a dead chain. the original chain with actual immutability principles won out long term imo
ETC won out as a principle but ETH won as an investment. $12.17 ETH in 2016 vs $119M ETC market cap tells you where the capital went
Dusan M. ETH at 12 dollars vs ETC at 119M market cap. the market picked developer activity over philosophy and it wasnt even close. ETC at 6th was a brief sentiment spike
ETC won the principle and ETH won the market. turns out capital cares more about developer activity than philosophy
the DAO hacker sitting on 5pct of ETC and the chain just kept going. says a lot about crypto resilience but also says nobody really knew what to do about it
the fact that the DAO hacker still held 5% of all ETC tokens worth $7M and the chain kept going tells you everything about crypto resilience
^ exactly. no bailouts, no rollbacks. this is what decentralization actually looks like when it gets tested under fire
the hacker holding 5% was actually bullish for ETC price action in the short term. everyone knew those coins werent moving so circulating supply was effectively reduced
Poloniex and Kraken delisting DAO tokens was the right call. The fork chain should have never needed that rescue in the first place.
ETC staying top-10 was one of the most bullish signals for crypto immutability ever. hard money in code
DAO fork decision was literally the first blockchain civil war. ETC proved immutability beats centralization every time
ETC at #6 with 119M mcap shows how tiny everything was. a single token unlock today moves more value than the entire ETC network was worth back then
Poloniex listing ETC in the middle of the fork controversy was peak crypto exchange energy. list first, ask questions never
poloniex listing ETC during the fork controversy was so on brand for 2016 crypto. list first think never
Poloniex listing ETC mid-controversy was the most exchange thing ever. list first ask questions never. same playbook every fork since
The DAO hacker holding 5% of all ETC was the ultimate poisoned chalice. anyone buying ETC was indirectly funding the attacker
Lior K. thats why Poloniex and Kraken delisted DAO tokens. the legal exposure of trading assets tied to a known exploit was enormous
immutability_kep right on the legal angle. exchanges delisted DAO tokens because holding proceeds from a known exploit is a compliance nightmare
ETC at $119M market cap being #6 shows how small everything was. a single token unlock today moves more value than the entire ETC network was worth