Coinbase – one of the largest digital currency exchange platforms – announced on June 12, 2018 that they will be adding forked version of Ethereum, called Ethereum Classic on their platform. The addition of another cryptocurrency to this trading platform has many implications for the price and the market size of Ethereum Classic.
To shed some light on its background, Ethereum Classic or ETC was created due to a fork in 2016 where the changes being made to Ethereum were not unanimously agreed to. Generally, a fork leads to two distinct versions of a product. Thus, as a result of these disagreements, Ethereum Classic was created. According to their website, Ethereum Classic is a better developed version of cryptocurrencies that are already floating in the digital market place; it also allows for a heightened level of independence when managing one’s digital profile along with an increased level of security.
It is interesting to see Coinbase including another cryptocurrency into their platform since they had explicitly stated, in a blog post in January, that “no decision to add additional assets…” had been made. They also reiterated this statement in March when answering some Frequently Asked Questions (FAQs) from customers devoted to the platform. Thus, it will be interesting to learn about the factors that led to a decision to add another cryptocurrency to their trading platforms – just months after such statements had been made.
According to Coinbase Blog the decision to add Ethereum Classic to Coinbase seems to be “consistent with our process for adding new assets”. Post this announcement, the next steps will be to create a support system for ETC. It is also implied that the entire process of integrating Ethereum Classic into the platform will be a very transparent activity. Finally, a launch date will be announced once the integration of Ethereum Classic is complete and clear of any systematic problems. The Coinbase Blog’s post also covered a detailed analysis of the impact of Ethereum Classic on their other products and the digital market place. Furthermore, it also highlights and provides insightful answers to another round of Frequently Asked Questions (FAQs).
We are pleased to announce our intention to add support for Ethereum Classic (ETC) on Coinbase in the coming months.https://t.co/bUG4iLUr2J
— Coinbase (@coinbase) June 12, 2018
It’s really interesting that Coinbase added Ethereum Classic to its exchange before it added Ripple. Investors were keenly waiting for Ripple being added to the platform as there was great deal of grapevine in the past. At the moment we believe ETC addition before XRP is enough indication about ETC future potential. Now that the implications of adding another cryptocurrency to their trading platform has been clarified and understood, it is important to understand the implications to Ethereum Classic after the announcement of their entrance into this exchange platform.
It might seem natural that such a great merger will serve to inflate Ethereum Classic’s value, which was exactly what happened. Just after the announcement the price of Ethereum Classic shot up from $12.93 to $16.22. This 25% price increase would imply that the increase in price was directly affected by the increase in its value: what customers stand to gain from purchasing it. Adding ETC to one of the largest exchange platforms in the world of digital currencies will allow greater exposure for the cryptocurrency and, consequently, increase its value. Moreover, the market for Ethereum Classic will expand in anticipation of a more widespread customer base. It will be interesting to monitor the price of ETC for the next few weeks, as well as monitor its price range after it is an active part of the trading platform on Coinbase.
Coinbase serves as one of the largest trading platforms for digital currencies with its headquarters in San Francisco, California after Brian Armstrong and Fred Ehrsam founded it in 2012. Along with providing crypto exchange services in approximately 32 countries and annual revenue of $1 billion USD, Coinbase is on its way to start its own Coinbase Index Fund.
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