The Ethereum Classic price declined on Friday as part of the overall cryptocurrencies sell-off. ETC fell to a low of $63, the lowest it has been since May 24. This price was 63% below its all-time high of $176 and 77% above the lowest level last week. It has a market capitalization of more than $8.25 billion, making it the 19th biggest cryptocurrency project in the world.
Ethereum correlation with Ethereum Classic
Ethereum Classic price has had an excellent performance this year. It has jumped by more than 1,100% this year alone and by almost 1,000% in the past 12 months alone. It was not always like that. Indeed, ETC remained in the sidelines since it was started through a hard fork a few years ago.
This year, the ETC price coincided with the overall performance of Ethereum. As you recall, a few weeks ago, Ethereum jumped to an all-time high of more than $4,000 as demand for its network rose. This was the main reason why ETC’s rank jumped from 50 to a top 20 digital currency.
In the past few weeks, the correlation between ETC and ETH has become widely visible. As the Ethereum price became more expensive, more retail traders decided to use ETC as a proxy. The theory was that with a $1,000, you can buy more ETCs than ETHs and benefit as the price rose.
The ETC and ETH correlation is similar to that of Bitcoin and Bitcoin Cash or that of gold and silver. In most cases, Bitcoin Cash tends to track Bitcoin while silver tends to track gold.
Still, in general, the key concern for Ethereum Classic is that very few developers have embraced it. Indeed, while thousands of projects are built on Ethereum’s network, very few of them are built on Ethereum’s Classic network. Some of the few that are built on the network are Stampery, Commonwealth Tribes, and Arena Racing, among others.
At the same time, those that are built on Ethereum Classic are known for common security attacks. So, what next for Ethereum Classic price?
Ethereum Classic price prediction
The four-hour chart shows that the Ethereum Classic price has been in a tight range in the past few sessions. The currency found substantial resistance at $83, which was 110% above the lowest level last week. Today, the token declined below the key support at $73. The pair is also slightly below the 25-day and 50-day exponential moving averages (EMA).
Therefore, at this stage, the outlook for ETC is neutral with a bearish bias. After the bearish breakout, the currency may keep falling as investors target the next key support at $50. However, we cannot rule out a rebound if Ethereum and other cryptocurrencies bounce back during the weekend.