Scam or not: Cryptocurrency community divided over Ethereum Classic

Thursday, August 11, 2016 11:31 AM UTC

Ethereum Classic has been gradually spreading its wings since the Ethereum community went ahead with the hardfork solution. Several exchanges and mining pools have added support this new cryptocurrency, which currently sits at the sixth position of cryptocurrencies by market cap.

However, in a recent blog on Huffington Post cryptocurrency enthusiast David Seaman has not only called the project a scam but has also raised questions about Barry Silbert, founder and CEO of the Digital Currency Group, involvement in promoting it.

“It [Ethereum Classic] is just an insecure orphan chain which is being promoted by a wealthy guy in New York, relentlessly, in a way that would be absolutely illegal if "Ethereum" were a publicly traded company or commodity - which it may well be one day soon, in some form”, Seaman wrote.

Stressing on Silbert’s previous cryptocurrency run-in with the SEC, Seaman went on to accuse leading cryptocurrency media outlet CoinDesk, wholly acquired by Silbert’s Digital Currency Group, of shifting to a biased promotional strategy for Classic since the acquisition.

It is sad to see the Ethereum developer community splintering. ETH or ETC, everybody should rally behind whichever chain the market selects
— Barry Silbert (@barrysilbert) August 3, 2016

1/ Setting the record straight:
1) I've sold 0 ETC
2) I've bought and am buying more
3) I do not intend to personally sell until ETC>ETH
— Barry Silbert (@barrysilbert) August 7, 2016

2/ My lower bound price for ETC is market cap of Litecoin ($175 mm) given ETC has more 1) utility, 2) devs, 3) holders, 4) differentiation
— Barry Silbert (@barrysilbert) August 7, 2016

Seaman is not the only one calling the Ethereum Classic project as a scam. Cryptocurrency exchange BTC-e said so in a blog post last month.

"BTC-e’s official standpoint on this issue is as follows: Ethereum Classic in the current circumstances is a scam”, it said.

Jonathan Patenaude, founder of Reddcoin, said in a tweet: “Auroracoin RIP 2014, Paycoin RIP 2015, Ethereum classic RIP 2016... all the same. Don't fall for the scam.”

However, there are Ethereum Classic supporters who believe that it is not a scam. In an online post titled “Ethereum Classic is not a scam. ETC= .01 Bitcoin is inevitable. Expect Ethereum parity!”, ‘bitcoinmeister’ said on Steemit:

“People being fooled into dumping their free ETC insurance may end up bitter and regretful one day… In the end of the day parity is a blessing because both coins will be able to move on from this spectacle and all the bickering and infighting will be over. #Ethereumclassic and Ethereum will survive.”

Another user ‘defango’ wrote: “I'm mining Ethereum Classic, and I don't intend to leave money on the table or lose out in a potential growth of ethereum classic.”