But in recent years, even better-known companies like Block Inc. (SQ) formerly known as Square and Tesla Inc. (TSLA) bought Bitcoin to hold in lieu of cash. Master limited partnerships offer reliable and robust payouts for investors. Even if cryptocurrency itself doesn't succeed over the long run, Ethereum could still be used in other ways. In September, Securities and Exchange Commission Chair Gary Gensler suggested that cryptocurrencies such as Ethereum could be considered a security, which would make them subject to SEC regulations. These five stocks are selling at attractive valuations today. Theres even room for more lines. What are the differences between Bitcoin and Ethereum. Both have the potential to perform well over time as the world continues its shift to digital and cryptocurrency's acceptance grows. Finally, you might need to create a separate crypto wallet to hold your ether coins. As its technological advantages gain steam, Ethereum investors could see $1,500 in the near term and $2,500 sometime by the end of 2021. The promise of a 99% reduction in electricity, faster transactions, and vastly increased scalability is an ambitious goal. First, that would make ether a good investment for those looking for others ways to make money with their crypto holdings beyond trading. Eberhardt had previously referred to The Merge, which was finally completed at around 7.45am on 15 September 2022, as "one of the most influential events in the history of crypto by impacting Ethereum both technically and economically". When evaluating offers, please review the financial institutions Terms and Conditions. 2021 was a strong year for Ethereum, as it hit its all-time high of $4735 in November. CryptoManiaks is an authoritative crypto education platform dedicated to newcomers and cryptocurrency beginners. Pre-qualified offers are not binding. This would further eliminate banks and centralized third parties from the transaction process. The DeFi explosion continued, with more than $100 million in total value being locked up. in journalism from the University of Missouri-Columbia. Before you invest in this cryptocurrency, make sure you've done your research and know what you're getting into. By keeping most of your money in safer investments, you can limit your risk in the event that Ethereum takes a turn for the worse. That announcement was one of the reasons behind the most recent crypto crash as investors questioned whether cryptocurrency could really thrive over the long term. Ethereum could end up being a smart investment, but it's not right for everyone. On the other hand, there were issues such as the conflict between Russia and Ukraine and the uncertainty caused by the pandemic. Ethereum can also be used to transfer value. Multiple crypto platforms where you can buy or sell Ethereum and other coins have crashed or been hacked, leaving users without access to funds. Bitcoin was initially meant to be a cryptocurrency -- emphasis on currency. Ethereum is different and is intended to be a platform for smart contracts. Here are 5 reasonswhy is Ethereum worth buying and why to take action and become an early adopter and investor. NerdWallet Compare, Inc. NMLS ID# 1617539, NMLS Consumer Access|Licenses and Disclosures, California: California Finance Lender loans arranged pursuant to Department of Financial Protection and Innovation Finance Lenders License #60DBO-74812, Property and Casualty insurance services offered through NerdWallet Insurance Services, Inc. (CA resident license no. Technically, the supply of ETH is unconstrained, and there are currently more than 122 million in circulation. However, the Fed has hiked 0.25 percent base points this January, as inflation showed signs of easing a bit. This means that Ethereum is in good hands. According to Ethereum founder Vitalik Buterin, the update's primary focus is to address the platform's scalability challenges by fragmenting the ETH database, enabling the network to scale while preserving its decentralized nature. Unlike stocks, owning crypto doesnt give you ownership of a company. Even small-time investors can get into high-priced real estate with these seven REIT ETFs that pay dividends. and have not been previously reviewed, approved or endorsed by any other Ethereum is still a high-risk cryptocurrency, and it's not the right choice for everyone. The Winklevoss twins, the famous Harvard alumni who claim Mark Zuckerberg stole the idea for Facebook now Meta Platforms Inc. (META) from them, famously tried to start a bitcoin ETF, but they were rebuffed by the Securities and Exchange Commission. Funds are volatile, and transactions are irreversible. In 2021, ethereum gained more than 400% in value, handily outperforming bitcoin's modest 62% rise (as of Dec. 31). In recent times, Ethereum, the second-largest cryptocurrency by market capitalization, has been making headlines due to a sudden surge in value. Can Cryptocurrency Be Part of a Diversified Long-Term Investment Portfolio? Also, the network can only process about a dozen transactions per second, regardless of demand. Transactions are also irreversible, and its possible to lose funds by making a typo when attempting to make a transfer. The last thing you want to do is put your life savings behind an investment as high-risk as cryptocurrency. So, what are some more reasons to invest in Ethereum? Here at CryptoManiaks, we are staffed with people who have all worked, studied, and generally kept up to date on cryptocurrencies. ETFs offer a liquid, low-cost way of investing in bonds. While we're here, I've compiled my favorite platforms to buy ETH, and I recommend you use one of them: *eToro Disclaimer: Your capital is at risk, The World Economic Forum (WEF), in their surveys and research, projected that up to 10% of the global Gross Domestic Product (GDP) will be stored and transacted with the help of blockchain technology by 202527.. The altcoin hit its all-time high in October 2021 at the $4,899 level. With S&P 500 companies alone sitting on trillions of dollars in cash and short-term investments, the growing acceptance of holding Bitcoin on balance sheets has potential to be a massive catalyst for BTC. Article printed from InvestorPlace Media, https://investorplace.com/2021/04/ethereum-will-catch-up-to-bitcoin-within-the-next-six-years-if-past-performance-continues/. Recently, ether hit a new all-time high close to $1,500. She's been a speaker at both CardCon (2017, 2018) and FinCon (2019). By: Edul Patel | Updated at : 28 Feb 2023 04:17 PM (IST), Ethereum has gained about 84 percent from its lowest cycle in the past seven months. There may be no regulatory recourse for any loss from such transactions. Ethereums price has significantly jumped, but it has also seen major dips. What Is the Best EV Stock to Buy Now? Uncertainty, even about government regulation, leads to a murkier investment environment. Many of those applications have cryptocurrencies of their own. And technologies led by intelligent, focused people are often a good bet. Currently, there are more than 100 million Ether in circulation -- with more being created each day. Cryptocurrencies like Ethereum are unlike any other kind of investment. Ethereum, like every other cryptocurrency, has endured a drop of around 80% from the highs of Q4 2021 to the lows of the recent bear market - despite fundamentals tightening and adoption increasing all the time. Run-ups like these can be difficult to ignore, and some experts believe Ethereum has a promising future. When more people hold Ethereum for a more extended period, it suggests that they believe in its long-term value and potential. One Way to Earn Passive Income, Get more smart money moves straight to your inbox. This influences which products we write about and where and how the product appears on a page. Our team is comprised of cryptocurrency investors from all over the globe, and our members come from traditional industries such as finance and engineering to more modern professions like full stack developers and data scientists. BTC still uses PoW, but Ethereum's long-awaited Merge moved the network to a proof-of-stake, or PoS, mechanism. Some experts say that the comparison between Ethereum and Bitcoin is like comparing electricity with gold. Ethereum, unlike Bitcoin, plays a vital role in NFTs (digital assets tied to unique tokens), decentralized applications, decentralized finance and the creation of other cryptocurrencies. For example, on March 11, the New York Times reported that, during a Christies auction, a JPG file sold for $69.3 million. Our estimates are based on past market performance, and past performance is not a guarantee of future performance. after opening a Webull account, activating crypto trading, and completing one [1] crypto trade before 3/31/2023. While Ethereum-based transactions tend to be far faster than Bitcoin transactions, there's a steep cost that comes with that convenience, known as gas fees. But it's not just investors enjoying more access to BTC. This was a new high for an artwork that exists only digitally. It should only be considered if you have a high risk tolerance, are in a strong financial position and can afford to lose whatever you invest in it. Vitalik Buterin, Ethereum CEO, is a leader unlike any other. It works like this: A user can commit Ethereum they already own in exchange for the chance to approve a new block of transactions, earning a reward if they perform this task well and putting their stake at risk if they dont. In September, Securities and Exchange Commission Chair Gary Gensler suggested that cryptocurrencies such as Ethereum could be considered a security, which would make them subject to SEC regulations. Of course, if Vitalik manages to release these updates on time, the value and price of Ethereum will increase significantly. Unlike gold, however, newly discovered reserves aren't possible, and around 92% of all Bitcoin, or roughly 19.3 million, have already been mined. Over the years, weve experienced countless issues. 7 Penny Stocks Poised for Explosive Growth in 2023, Ethereum Is a Much Better Long-Term Crypto Investment Than Bitcoin. Cryptocurrency is still a highly speculative investment, and there's no guarantee Ethereum will succeed over the long run. Investing in assets is always a wise decision, but it's crucial to remember that investing is a long-term process focusing less on immediate or short-term profits. One of the only things standing in the way of Ethereum's continued meteoric rise is the amount of success it is currently experiencing. The network is undergoing an overhaul that would make it more powerful and attractive for launching crypto projects. The Ethereum network is at the forefront of the still-nascent decentralized finance, or DeFi, area. Everyday consumers can earn Bitcoin via services like Lolli, the first Bitcoin rewards application allowing people to earn BTC back when shopping online. The foundation laid in 2020 significantly contributed to the run higher, as the markets had jumped out of a "Crypto Winter" earlier that year. Transactions are also irreversible, and its possible to lose funds by making a typo when attempting to make a transfer. Best Parent Student Loans: Parent PLUS and Private. Between May 12 and May 24, Ethereum lost nearly 50% of its value. For any cryptocurrency to survive, it needs to have some type of real-world utility. Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. 2 Reasons to Avoid a Roth 401(k) for Your Retirement Savings, Want $1 Million in Retirement? Disclaimer: NerdWallet strives to keep its information accurate and up to date. Neither the author nor editor held positions in the aforementioned investments at the time of publication. While it has somewhat recovered since then, it can be tough to stomach downturns like these. A $1,000 ethereum purchase on Jan. 1 at a price of $730.97 per coin would be. When interest rates are increased aggressively, it can impact people who borrow large amounts of money. Back in time, I heard of Ethereum almost as much as I heard of Bitcoin. Cryptocurrencies generally are highly volatile. Of course, there is no guarantee that it will. What about 50%? It's no surprise that investors are interested in cryptocurrencies. Before that he was a legislative editor for the Colorado General Assembly. Crypto tokens are "mined" through a series of complicated computer processes. Financial Market Data powered by FinancialContent Services, Inc. All rights reserved. A new era of computer programming, digital ownership, and other innovations are being introduced thanks to the smart contract capabilities of Ethereum. Since the hard fork of August 2021, Ethereum has experienced a massive change in its tokenomics. Thinking of Buying Solana? This will give you a more balanced perspective. Yield-hungry investors can make use of a variety of income-generating assets. Keeping your Ethers secure -- and keeping any cryptocurrency secure -- still requires work. Blockchain development is a skill in demand. Smart contracts let decentralized applications run automatically on the blockchain when certain predetermined conditions are met. We will only display websites accepting Uncertainty, even about government regulation, leads to a murkier investment environment. As a result, they may be less willing to invest in volatile assets like cryptocurrencies and instead keep their cash on hand. Our partners cannot pay us to guarantee favorable reviews of their products or services. 2 Reasons Why Ethereum is NOT a Good Investment There are two sides to every coin. It's been a wild ride for Bitcoin over the last 14 years. Mark Hake writes about personal finance on mrhake.medium.com and runs the Total Yield Value Guidewhich you can reviewhere. One of the criticisms of cryptocurrency in general is that it's incredibly energy intensive. After gaining more than 460 percent in 2020, Ethereums native cryptocurrency ether has continued to rise in 2021. Ethereum 2.0 is an updated version of the blockchain that's set to roll out later this year or early next year, and it claims to use 99.95% less energy than the current technology. Ethereums competitors, like EOS, claim their blockchain can perform leagues better than Ethereum. Sign up for stock news with our Invested newsletter. ( Image Source : Bastian Riccardi/Pixabay ) In recent times, Ethereum, the second-largest cryptocurrency by market capitalization, has been making headlines due to a sudden surge in value. Thus, in 2023the safety of buying, selling, and storing Ethereum falls on the user. Compared to other cryptocurrencies, using Ethereum can be slower and more expensive. Just like the internet -- which didnt die after the 90s internet bubble -- Ethereum has gained strength and momentum. While it's mostly known for hosting Ether, it's also used for nun-fungible tokens (NFTs), decentralized finance, and enterprise blockchain solutions. First, ether is more affordable than bitcoin, which makes it a top option for investors looking for cheaper bitcoin alternatives. With a smart contract, you dont need a third party to perform credible transactions. Many or all of the products featured here are from our partners who compensate us. That kind of discrepancy in performance is pretty significant. It is unfair to only look at one side. The table on the right shows the result of this trajectory. Is Ethereum a good investment? 3 Reasons I'm Investing in Cryptocurrency. Timing - dont buy at an all-time high, dont sell at an all-time low. Ethereum Is a Much Better Long-Term Crypto Investment Than Bitcoin Ethereum will catch up to Bitcoin sometime within the next six years, if past performance continues By Mark R. Hake, CFA Apr. The Ethereum network's native Ether (ETH) token debuted in 2015 at $2.83, eventually advancing to its own all-time high of $4,865 in November 2021. 2023 InvestorPlace Media, LLC. While some exchanges allow purchasing fractional shares of blue-chip cryptocurrencies like ether and bitcoin, others might only support whole coin purchases. In this article, we will attempt to forecast how Ethereum's price may behave in the future. Examples are hypothetical, and we encourage you to seek personalized advice from qualified professionals regarding specific investment issues. It also allows owners to stake Ethereum, earning additional ETH in return. Well, if: Then buying Ethereum in 2023 might be aworthy investment for you. With this in mind, the answer to the question is Ethereum a good investment starts to look like a no-brainer. Artificial Intelligence Stocks: The 10 Best AI Companies. On the date of publication, Mark R. Hake held a long position in Bitcoin and Ethereum. In 2022, many macroeconomic factors affected the global economy. Buy Ethereum Instead. Unlike small altcoins, it has less of a chance to crash and burn, but it still has the potential to moon and bring its investors astronomical profits. CME Group, the worlds largest derivatives trading platform, plans to introduce ether futures trading in 2021. Ethereums use case goes beyond crypto. This is also evident in the last year. Ethereum is also in the midst of a multi-year upgrade. Ethereum, however, is making moves to make the technology more energy efficient. This information may be different than what you see when you visit a financial institution, service provider or specific products site. Under this setu. While technically, this is not an interest rate or a company dividend, the chance to earn passive income is a plus for Ethereum owners who plan to have it long term. As the past few weeks have proven, cryptocurrency is still an extremely volatile investment. You should buy Ethereum if youre more interested in innovation and use cases rather than in scarcity and the economic model of Bitcoin. Ethereum is typically swapped in exchange for the hottest new tokens, which raise demand for Altcoin. . You can earn additional Ethereum by staking. While technically, this is not an interest rate or a company dividend, the chance to earn. More than 10,000 vendors offer rewards via Lolli, including companies like Nike Inc. (NKE), Walmart Inc. (WMT), Best Buy Co. Inc. (BBY), McDonald's Inc. (MCD) and Dunkin' Donuts. In fact, over the course of 2018, Ethereum's price plummeted by nearly 94%. Buy Ethereum instead of Bitcoin, if you believe this outperformance will continue. Before you invest in Ethereum, think about your tolerance for risk. We know why Bitcoin is a good investment -- butis Ethereum an even better buy? The current CoinMarketCap ranking is #238, with a live market cap of $133,535,311. Its price had sunk below $1,800 as recently as July. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. Over two months ago I predicted that ETH would continue to outperform Bitcoin. Cryptocurrency is a risky investment in general because it's highly speculative at this point. Even after a severe crypto market pullback in 2022, Ethereum was recently trading for around $1,628, which means it has advanced 575-fold in less than eight years. These investors may continue to pile into ether if bitcoin seems to take longer to pull back up. The investing information provided on this page is for educational purposes only. One of them is the trouble of buying Ethereum. It works like this: A user can commit Ethereum they already own in exchange for the chance to approve a new block of transactions, earning a reward if they perform this task well and putting their stake at risk if they dont. The Motley Fool owns shares of and recommends Bitcoin and NVIDIA. So dip your toes in the water little by little. Bargain hunters looking to buy and hold should consider these weed stocks. So should you buy Ethereum or Bitcoin? Also, bitcoin has a track record of boom and bust. With Bitcoin, you can store value and pay for things, while with Ethereum, you can program smart contracts, tokenize assets, and more. It still has bugs here and there, but for people who are willing to be involved and try this new technology --- it can prove quite profitable. His passion and genius are committed to improving Ethereum no matter what. Ethereum is the world's second largest cryptocurrency behind Bitcoin, its price recently surging to a record high of $3,400 at the beginning of May 2021, a quadrupling in its value since the. 2021 is arguably a great year for all crypto enthusiasts as the price of most cryptocurrencies increased incredibly at the opening of the year. People may receive compensation for some links to products and services on this website. Both Bitcoin and Ethereum have exhibited a positive correlation in the past years. Consider these diversified no-load fund picks for your retirement or taxable investment accounts. Ethereum has been particularly popular with decentralized finance applications. As the de facto cryptocurrency leader, no other coin even comes close to Bitcoin. It should only be considered if you have a . Ethereum is an established name in crypto. NerdWallet does not offer advisory or brokerage services, nor does it recommend or advise investors to buy or sell particular stocks, securities or other investments. Ethereum's high gas fees. For now, heres a list of the essentials you need to know before investing in Ethereum: Transacting with Ethereum is very similar to Bitcoin -- but there are still a few differences. There are plans to indirectly lower prices through higher transaction throughput, but that will require implementing unproven technology that isnt yet available. If Ethereum were to disappear overnight, a much larger swath of the crypto world would also vanish. OriginTrail is down 0.89% in the last 24 hours. If you think that Ethereum price predictions make it a good investment, you might want to know how to invest in it. Your all-in guide to help you make the best decision. A Guide For Beginners, What Is a Blockchain? ALSO READ: Bitcoin Is Seeing A Resurgence This Year After A Challenging 2022: Heres Why. 2020 created an entirely new year for Ethereum. In October, Rostin Behnam, the chair of the Commodity Futures Trading Commission, said that Ethereum is a commodity and should fall under CFTC regulation. But proving it is another thing. is a plus for Ethereum owners who plan to have it long term. To make the world smarter, happier, and richer. They're both digital currencies that can be used to make transactions. Investors and traders may anticipate fewer interest rate hikes than last year and may be interested in buying crypto assets. Sometime between year five and six, Ethereum will catch up to Bitcoin. Multiple crypto platforms where you can buy or sell Ethereum and other coins have crashed or been hacked, leaving users without access to funds. This limits the supply of Bitcoin and increasing its value. Is Ethereum a good investment or is it too late? That represents a gain so far this year, of 273%. However, the Ethereum blockchain is used for a variety of purposes, which gives it an advantage. The Motley Fool owns shares of and recommends Bitcoin and Tesla. Use 2 Factor Security and use strong passwords. Government regulators dont always agree about crypto or how to treat it. Read more. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. If you dont mind me getting a little technical -- Bitcoin has a deflationary model. With a. (The author is the CEO and co-founder of Mudrex, a global crypto investing company). When evaluating offers, please review the financial institutions Terms and Conditions. Both Ethereum and Bitcoin are fascinating -- in their own ways. (Getty Images). 3 Cryptocurrencies Poised for Monster Rebounds in 2022. Making the world smarter, happier, and richer. Another reason you might consider ether a good investment is the launch of ether futures trading. Ethereum allows computer programs to run smart contracts.. For example, year-to-date ETH is up by $1,993 from $737 where it was on Dec. 31. We at Cryptomaniaks have had our fair share of challenges and mistakes. And I wondered: should I buy Ethereum? We're in unchartered territory with crypto, and it's anyone's guess whether it will change the world or crash and burn. Ether costs around $4,100 per coin, as of this writing, while Bitcoin costs around $57,400 per coin. One immediate implication for the Ethereum network is that its energy usage is expected to drop by more than 99% following the shift to PoS. One thing must be mentioned about this popular crypto is the Ethereum Merge (Ethereum 2.0). Also, Ethereum 2.0 plans to make the blockchain faster and more scalable so it can be used for even more applications. That is a gain of 87%. Which is the better buy now? Cost basis and return based on previous market day close. However, I believe that Ethereum will increase at least 200% per year and Bitcoin will rise 50%, starting at $54,891 (BTC) and $2,636 (ETH). Heres a quick rundown of some of the biggest considerations regarding the investment outlook for each cryptocurrency. Storing ETH and other crypto carries risks.