Is Ethereum A Good Investment And Can You Profit On ETH In 2021?
Ethereum may be a good investment for you, if you are a long term investor!
Cryptocurrency is anonymous, blockchain-based digital money. You may know the most common Bitcoin and Ethereum variants, but according to Coinmarketcap, there are over 12,000 cryptocurrencies.
You can invest in cryptocurrencies but now, it is also possible to purchase standard products and services with cryptocurrencies. Though cryptocurrency is new and interesting, it may be risky to invest, so you have to do a ton more analysis before investing in any crypto asset.
Experts have mixed viewpoints on cryptocurrency investments. Because crypto is a risky investment with a potential for intense price fluctuations, certain finance consultants are sceptical when it comes to investing in crypto.
However, many people have a hard time to decide which cryptocurrency to go with. As said above there are more than 12,000 cryptocurrencies. Most people already know Bitcoin, but but some will start to diversify and look for bigger opportunities, such as Ethereum.
Ethereum is one of the largest cryptocurrency in the market and it is a cryptocurrency that functions very uniquely when compared to other cryptocurrencies. ETH brings with it some new and exciting opportunities.
Ethereum Investing: What Is It?
Initiated in 2015, with the smart contracts and distributed apps capabilities, Ethereum is an open and decentralized cryptocurrency computing framework. ETH or Ether is the platform’s local blockchain. Ethereum now is the world’s most popular blockchain. Following Bitcoin, Ethereum is the second-largest share price blockchain throughout the world.
Investing in Ethereum could be an investment in finance's future. The intelligent contracting platform was built to replace the outdated obsolete history of Wall Street and has already begun replacing corporate shares and bonds with intelligent contract tokens within certain company transactions.
The capacity of Ethereum is perhaps much more incredible than that of Bitcoin, which serves as a forum for developers to continue to expand on and innovate. The latest DeFi pattern is an example. An ambitious new initiative and extension to the funding world are breaking new ground almost every new day and transforming the market forever. It contributes to modern crypto mots such as "yield agriculture" and the “pooling of liquidity."
Many other cryptocurrencies are built on the Ethereum blockchain. For example, a new ERC-20 token named Yearn Finance or YFI has been built on Ethereum. The intelligent contracts were built to have digital scarcity for the commodity and only 30,000 tokens. Many have varying supplies and completely different instances of need. Ethereum is one of the most prominent cryptocurrency projects, so investing in Ethereum now can lead to great financial gain and investment return.
Is Ethereum a Good Investment? How it Performed in 2020?
Due to Covid-19, 2020 was a year of challenges for the world. Cryptocurrencies, including Ethereum, dropped in value in March due to the pandemic but later on, they started increasing in prices.
On the last day of 2020 Ethereum hit the $750 mark which was the highest level since March 2018. Moreover, Ethereum hit its all-time high at $4,362.35 on May 12, 2021.
The latest price indicators suggest that the second-largest cryptocurrency in the world is expected to test new peaks in 2021. ETH's latest Beacon Chain implementation and network update also brought a variety of institutional investors interested in staking Ethereum 2.0 to make the mechanism more effective. ETH presently has a market cap of $442.51B.
Because of the rising interest in Ethereum 2.0, a range of cryptocurrency exchanges, including Binance, began to offer ETH staking services. Finance Magnates previously stated support for the ETH network for the new update from the Gemini cryptocurrency exchange.
As staking reduces the number of coins in circulation, if suppliers decline and demand remain high, Ethereum’s price could increase. The launch of Ether future trading is another explanation you might consider a successful bet. In 2021 it aims to launch Ether futures trading through CME Group, the world's largest trading site for derivatives.
Although Bitcoin is known as “digital gold”, because of its huge potential, Ethereum is considered “digital oil.” The most widely used blockchain is Ethereum. Many crypto projects on the network have been released. For decentralized financial applications, Ethereum was especially common.
The network went through a revision that will make crypto ventures more efficient and appealing. After the update, Ether could see the wider acceptance that would raise its price.
With the new update to the Ethereum network, Ether staking is allowed. Next, it will be a decent investment for those who are searching for other forms of making money out of business for their crypto holdings.
Overall 2020 was a good year for Ethereum as it had a significant increase in price and the release of Ethereum 2.0 marks one of the determining point of Ethereum’s future.
Read Also: Will Ethereum Outperform Bitcoin?
Investing In Ethereum in 2021? Is It A Good Idea?
According to crypto experts, Ethereum is considerd as a good investment. A research paper done by the economist indicates that Ethereum is far more likely to expand in the future. The price of Ethereum is expected to reach $4,756 by the end of 2021, based on "Long Forecast" prediction.
Investing in Ethereum has proven to be a good decision. In 2019, the average price of Ethereum was $125. The current price is $3,752. In two years, the value of ETH went up 2901.6%. So, if you had invested $10,000 into Ethereum back in 2019, right now you would have about $300,160 in Ethereum.
But to know if it is a really good idea to invest in Ethereum a basic meaning of the Ethereum blockchain itself should be investigated first.
Ethereum 2.0 was launched in several phases starting from Phase 0. ETH is the token of Ethereum blockchain. Ethereum is indeed a tool to secure savings if Bitcoin is solely a form of payment. Many of them are theoretically good choices in the area of longer-term investing.
The Ethereum blockchain is the protocol based on mathematics rules. In comparison to a central bank or government that can change cash provision rapidly and suddenly, the distributing Ethereum coin is written into a freely readable and consensus coding. This digital commodity, instead of a gold or government pledge, is backed up by the unbreakable uncrystallized blockchains and mathematical reality.
Ways to Invest In Ethereum
The entry barriers to start investment are very low for cryptocurrency. Someone unfamiliar to the area will quickly get hold of ETH and start saving by hanging on to it and hoping for appreciation.
Furthermore, a person can potentially make an investment in Ethereum and start making money from ETH through a variety of means.
All starts with buying and holding. This is one of the most common strategies for investing in cryptocurrency. The buying and holding of a cryptocurrency is an easy and generally successful way. The strategy to buy and retain is a nice, straightforward solution but it can cause uncertainty as the field of cryptocurrency is famous for its price explosives. Cryptocurrencies have a volatile nature, because of which many investors have shied away. But for some, it has been one of the most valuable factors that cryptocurrencies are characterized by and it has attracted them to invest.
Another way of investing in Ethereum is through mining. Cryptocurrency mining is a mathematical solving method. Mining is basically the backbone of many cryptocurrency networks as they use their time to solve mathematical problems with computing power and to provide the network “proof-of-work” that verifies transactions of Ethereum (ETH). The launch of Ethereum 2.0 with the aim to transition to “proof-of-stake” could be a concern for miners however PoW mining is anticipated to be still practical until around 2023.
Cryptocurrency trading including Ethereum has begun with conventional traders by diving into existing markets. There is also a range of trading options such as ETH futures, which make it one of the better ways of investing in Ethereum.
Derivatives trading allows traders to reap just as well from drawdowns in upward patterns. Traders may take advantage of long or short positions regardless of how the demand moves.
Ready to invest in ETH?
Pros and Cons of Ethereum
Like any asset, there is a list of pros and cons for Ethereum.
Pros of Ethereum:
What are the benefits of investing in Ethereum?
Many crypto-analysts think that Ethereum has a big future, making it an attractive option for crypto investors.
Here are the best things about Ethereum:
For the last three years, Ethereum's established network and program have been consistent. The team behind Ethereum is putting a tremendous effort that is making Ethereum one of the biggest projects in the crypto sphere.
The decentralized structure is possibly one of the key benefits of Ethereum. As stated, cryptocurrency technology, originally developed to provide an alternative to conventional banking processes, is decentralized and transparent. Decentralized Finance (DeFi) is one of the factors that cryptocurrencies are characterized by and Ethereum is at the top of DeFi.
✅ More businesses are pursuing Ethereum:
Ethereum is supported by several large businesses and the Ethereum Enterprise Alliance is a leading Ethereum tracking organization. When third-party conditions are removed, Ethereum investors invest more. The finance guru Andreessen Horowitz, is one of the major figures involved in Ethereum. In comparison, the fact that Ethereum is also a pro in finance (ICOs). The tokens ERC-20 are also considered the standard for fundraising and ICOs.
✅ Ether is not constrained:
Unlike Bitcoin, Ether (ETH) is not constrained and is useful. Transactions include contracts for self-running and short settlement times. Interestingly, once the creator Vitalik Butterin said Ethereum could quickly handle more than one million transactions per second.
Cons of Ethereum
Here are the weaker parts about Ethereum:
❌ Criticism for slow growth
Ethereum has been criticized for slow growth. On the verge of DeFi expansion analysts have questioned whether Ethereum could succeed under the weight of DeFi. This indicates that progress was slow and lagging in introducing network changes.
❌ The disadvantage to the first mover:
The first mover drawback has been acquired by Ethereum. The standard-bearer is still the legacy network. All new start-ups also learn from the staff and are adequately agile to enable quicker growth and results. In the long term, this could be an unknown hazard. Also, prosperous businesses will benefit from errors of Ethereum and perhaps establish improved networks.
❌ It is difficult for Ethereum to be scaled:
While its diverse features may be an enticing aspect, some investors are simply hesitant to invest in ETH. In comparison, Ethereum is yet to resolve problems related to scaling and Network latency to draw further investors in cryptocurrencies.
Conclusion: So Is Ethereum A Good Investment?
Ethereum is one of the best crypto to invest in, according to analysts. The famous coin is promising and as DeFi keeps growing with Ethereum at the top, then its price might soar high in the near future.
Most investments come down to the risk vs reward factor. In other words, do the potential rewards outweigh the possible consequences of the risks?
Put simply, Ethereum is low-risk investment with lots of potential rewards. It’s something you should definitely do some research before you consider adding ETC to your portfolio.
So is Ethereum (ETC) a good investment? Ethereum indeed has a lot of pros that many other cryptocurrencies do not have. The fact that Decentralized Finance (DeFi) is one of the factors that cryptocurrencies are characterized by and Ethereum is at the top of DeFi, means that there is a lot of room for growth in Ethereum price and making it a good coin to invest in.
Investing in Ethereum is a wise decision, If you want to be part of DeFi expansion then Ether is the right choice for your portfolio.
Now you know that Ethereum could be a good investment. If you’re feeling inspired enough to start investing in ETH, or if this article has provided some extra insight to your existing knowledge, you may be pleased to know that eToro provides the ability to invest in crypto assets.
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Virtual currencies are highly volatile. Your capital is at risk.
- Cryptocurrency is anonymous, blockchain-based digital money.
- It is also possible to purchase standard products and services with cryptocurrencies, but you can also invest in cryptocurrencies including Ethereum.
- Ethereum is one of the largest cryptocurrencies in the market and it is a currency that functions very uniquely relative to other cryptocurrencies.
- Investment in Ethereum could be an investment in finance's future.
- The capacity of Ethereum is perhaps much more incredible than that of Bitcoin, which serves as a forum for developers to continue to expand on and innovate.
- A research paper done by The Economist indicates that, Ethereum is far more likely to expand in the future.
- You can invest any amount of money in Ethereum. You can start with as little as $25 for example.
- As DeFi keeps growing with Ethereum at the top, Ethereum could be one of the best investments one can make in the crypto market right now.
Is it worth investing in Ethereum?
Based on its convenient access to retail buyers and its continued growth prospects, Ethereum makes an outstanding investment.
What is the minimum amount to invest in Ethereum?
There are some platforms, such as eToro, allow users to put in as little as $25 to get started in Ethereum.
Should I invest in Ethereum now?
When wanting to invest in any cryptocurrency you should always do your own research. Ethereum is one of the best cryptocurrencies with the potential to grow in price in the near future.
Where to invest in Ethereum?
eToro is the most lucrative alternative. The prestigious award trading platform allows traders to create a portfolio, serving as a one-stop-shop for traders finding exposure to cryptocurrency.