On July 20, 2016, at block 1,920,000, the Ethereum network executed an irregular state change to reverse The DAO exploit. A portion of the community rejected this intervention and continued mining the original, unaltered chain. That chain became Ethereum Classic.
The DAO
The DAO (Decentralized Autonomous Organization) launched in April 2016 as a smart-contract-governed venture fund. It raised approximately 12.7 million ETH (~$150 million at the time) — the largest crowdfunding campaign in history at that point.
The Exploit
On June 17, 2016, an attacker exploited a reentrancy vulnerability in The DAO's smart contract, draining approximately 3.6 million ETH into a child DAO. The DAO's design locked these funds for 28 days before they could be moved, creating a window for the community to respond.
The Fork Decision
The Ethereum community debated three options:
- Do nothing — let the code execute as written
- Soft fork — blacklist the attacker's address
- Hard fork — irregular state change to return funds to DAO token holders
On July 20, 2016, the majority of the network implemented the hard fork at block 1,920,000, rewriting state to move The DAO's ETH to a recovery contract.
The Original Chain Continues
Not everyone agreed. Those who held that blockchain immutability was non-negotiable continued mining the original chain — the one where The DAO exploit remained in the transaction history. This chain became Ethereum Classic (ETC), while the forked chain continued as Ethereum (ETH).
Supporters of the original chain argued:
- Immutability: If transactions can be reversed by social consensus, the blockchain loses its value as a neutral ledger.
- Precedent: Allowing one state intervention opens the door to future interventions.
- Code is Law: Smart contracts execute as written. The code's behavior is the agreement.
Early Challenges
Ethereum Classic faced significant obstacles in its first months. Most developers and infrastructure followed the forked chain. The ETC community had to rebuild tooling, establish its own identity, and attract new contributors — but a dedicated community formed around the principles of immutability, decentralization, and censorship resistance.
The chain that launched on July 30, 2015, continues unbroken on Ethereum Classic.