3 Reasons I'm Investing in Cryptocurrency. As an investor, this is a potential win. Contrast that with Apple Inc. (ticker: AAPL), the archetype of a fantastic stock and one of the best-performing equities of all time. That kind of discrepancy in performance is pretty significant. 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. Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. The current CoinMarketCap ranking is #238, with a live market cap of $133,535,311. If Ether is required for applications on the Ethereum blockchain, Ethereum's success could give Ether a competitive advantage over Bitcoin and other cryptocurrencies. Ethereums capacity to serve as a platform for other technologies and services is one reason some investors are upbeat about its future. However, this does not influence our evaluations. Cryptocurrency is a risky investment in general because it's highly speculative at this point. Ethereum is also okay at being a payment system too, but it does not have the brand awareness and immutability of Bitcoin -- plus Bitcoin is truly scarce since its capped at 21 million coins -- while Ethereum is uncapped. 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. You can easily trade Ethereum for cash or. Ethereum Classic kept the old blockchain -- along with the hacked funds. Skewed energy consumption dynamics. All rights reserved. Ethereum was at $198.47 on April 28 last year. 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. It has more media coverage and is the most established crypto asset. According to statistics from Coinmarketcap, Ethereum is the second most valuable cryptocurrency by market capitalization with more than 41.3 billion USD and is being traded for about 377 USD (statistics on September 17 . One of the crypto worlds long-awaited events since 'The Merge' last year, the Shanghai Update promises to enhance Ethereum's liquidity by unlocking the staked ETH in the Beacon Chain. ALSO READ: Bitcoin Is Seeing A Resurgence This Year After A Challenging 2022: Heres Why. Bitcoin Is Seeing A Resurgence This Year After A Challenging 2022: Heres Why, How Crypto Diversification Can Protect Your Portfolio Against Volatility. And the starting point at that time was $34,624. In the last month alone, ETH is up 60% from $1,691 to $2,730, as of April 28. Examples are hypothetical, and we encourage you to seek personalized advice from qualified professionals regarding specific investment issues. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. Cryptocurrencies generally are highly volatile. With Bitcoin's surge in early 2023, the "crypto winter" began to thaw. The Motley Fool owns shares of and recommends Bitcoin and Tesla. And I wondered: should I buy Ethereum? All Rights Reserved. 1125 N. Charles St, Baltimore, MD 21201. Moreover, Ethereum transaction fees are at all-time high levels. Ultimately, the debate between Bitcoin and Ethereum as investments comes down to an investor's risk profile. Ethereum, The 24-hour Surge 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. Ethereums whitepaper, which outlined its technical details, was released in 2013, and the first Ether sale took place in 2014. The cryptocurrency is supported by most major crypto exchanges like Coinbase and Binance. Dont leave your crypto assets on exchange platforms. Ethereum, however, is making moves to make the technology more energy efficient. Ethereum is a dominant force in crypto, but that doesn't mean it's risk-free. One Way to Earn Passive Income, Get more smart money moves straight to your inbox. This might have attracted new buyers who saw the existing holders as a signal of the asset's value. Sometime between year five and six, Ethereum will catch up to Bitcoin. Moreover, Ethereum is the blockchain most widely used in non-fungible tokens (NFTs). Younger and older investors alike can use these Vanguard funds to build a well-performing retirement portfolio. Vitalik Buterin, the founder and CEO of Ethereum, announced they will release Ethereum 2.0 -- saying the future launch of Ethereum 2.0 will be 1,000x more scalable and cut energy costs by 99%. At that time, you could buy one of the new digital tokens for less than a penny. Artificial Intelligence Stocks: The 10 Best AI Companies. They are not intended to provide investment advice. Bitcoin, however, is up by $26,477 from $29,374 to $55,851, as of April 28. Although they both have a proof-of-work system to reward validators of blockchains, Ethereums focus is different. The great thing about institutional investors is that they tend to have a long horizon. Particularly notable is that ether's rally came amid a. Currently, there are more than 100 million Ether in circulation -- with more being created each day. So, should you buy Ethereum? Source: Crypto Fees. A self-directed IRA can make sense in some situations, but investors must also understand the drawbacks. Of course, if Vitalik manages to release these updates on time, the value and price of Ethereum will increase significantly. Keep in mind what they are saying: each country worldwide will use blockchain technology up to 10% of its GDP. Ether (ETH), the native token on the blockchain network Ethereum and the second-largest cryptocurrency by market cap, is a risky and volatile investment. In addition, one major criticism of cryptocurrency, specifically Bitcoin, is how energy-intensive it is. Lorem ipsum dolor sit amet, consectetur adipiscing elit. Following the Ethereum merge, blocks of transactions would be verified using a consensus mechanism called proof-of-stake. The last thing you want to do is put your life savings behind an investment as high-risk as cryptocurrency. Be sure to weigh the pros and cons as well as consider your own tolerance for risk. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. 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. Previously, both cryptocurrencies used the proof-of-work, or PoW, mechanism to validate transactions and secure the blockchain. Meanwhile, Crypto commentator Alex Saunders has a $10,000 ether price prediction. Its price in November 2022 was less than a quarter of what it was one year earlier. 2 Reasons to Avoid a Roth 401(k) for Your Retirement Savings, Want $1 Million in Retirement? And technologies led by intelligent, focused people are often a good bet. Unlimited supply. So lets peak at a few reasons you should consider not to buy Ethereum. Whereas Bitcoin is sometimes called a distributed ledger, Ethereum co-founder Vitalik Buterin and others sometimes describe Ethereum as a distributed computer. Katie Brockman has no position in any of the stocks mentioned. after opening a Webull account, activating crypto trading, and completing one [1] crypto trade before 3/31/2023. Limited supply. A Guide For Beginners, What Is a Blockchain? Heres a quick rundown of some of the biggest considerations regarding the investment outlook for each cryptocurrency. The content It has all these different applications being built on top of it. Ethereum is a volatile investment, so be sure you're comfortable with risk before you buy. It makes sense that, according to cryptocurrency researcher Kevin Rooke, 94 out of the top 100 blockchain projects were launched on the Ethereum network.. In the past three months, ETH has surged by 36 percent. Here is a list of our partners and here's how we make money. Transaction fees can be a drag. Instead of being focused on the price, he is focused on making Ethereum the best smart contract platform. 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. Ethereum allows computer programs to run smart contracts.. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. varies by type of transaction; other fees may apply. ( 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. We believe everyone should be able to make financial decisions with confidence. Many or all of the products featured here are from our partners who compensate us. Ethereum is the blockchain technology behind Ether. Bitcoins supply will be limited to 21 million Bitcoin; its scarce -- much like gold. This could result in more volatility and greater risk. Out of the many cryptocurrencies that have made huge waves in the crypto world recently. Other cryptocurrencies are issued on it, NFTs trade freely on the platform, and the entire field of decentralized finance was ushered in with Ethereum and its versatile ability to create smart contracts. Ethereum may have been the first blockchain to run smart contracts -- but now it is not the only one. Ethereum Is Crashing: Is Now the Time to Invest? In other words, ETH has outperformed by almost 3 times, just since the beginning of the year. Tags: investing, cryptocurrency, Apple Inc., Meta Platforms Inc, CME Group, Nike, Walmart, Best Buy, McDonald's, MicroStrategy, Block, Tesla Motors, bitcoin, Ethereum, decentralized finance, blockchain. Cryptocurrencies are still a new kind of asset, and they have been highly volatile. There are many reasons to think that the native Ethereum blockchain cryptocurrency will continue to rise. Uncertainty, even about government regulation, leads to a murkier investment environment. From an investor perspective, it just kind of. Besides being an incredibly innovative technology, Ethereum is also a great asset for investment. If you think that Ethereum price predictions make it a good investment, you might want to know how to invest in it. But is it time to buy? First, it's important to distinguish the difference between Ethereum and Ether. Her areas of expertise include research and strategy. Both Bitcoin and Ethereum have exhibited a positive correlation in the past years. Disclaimer: The opinions, beliefs, and views expressed by the various authors and forum participants on this website are personal and do not reflect the opinions, beliefs, and views of ABP Network Pvt. But the decentralized Ethereum network also makes it possible to create and run applications, smart contracts and other transactions on . Well,if youre simply looking to invest in cryptocurrency and you can only pick one, perhaps Bitcoin would hold up better. For example, year-to-date ETH is up by $1,993 from $737 where it was on Dec. 31. These investors may continue to pile into ether if bitcoin seems to take longer to pull back up. While the Merge is expected to dramatically reduce the amount of new Ether produced every year, the fact remains that there's no hard limit. 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. 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. CoinCodex gave a short-term ethereum crypto price prediction for 2023 that estimated ETH could fall to $1,594.18 by 27 February before continuing to drop to $1,399.99 by 25 March. Also, bitcoin has a track record of boom and bust. However, even just a fraction of Ethereum can be purchased starting on most exchanges or trading platforms at a very low minimum. Subscribe to our daily newsletter to get investing advice, rankings and stock market news. For example, it may be that ETHs price rise will slow down or deaccelerate as its price becomes more expensive. If EOS and other so-called Ethereum killers can become faster, better, and stronger than Ethereum -- ETH could be in trouble. Bitcoin was the first cryptocurrency that CME Group Inc. (CME) offered futures contracts on in late 2017, allowing investors to wager on prices at specific dates in the future. With Bitcoin, you can store value and pay for things, while with Ethereum, you can program smart contracts, tokenize assets, and more. Both Bitcoin and Ethereum use blockchain distributed ledger technology. Since. This story was published at an earlier date and has been updated with new information. Bitcoin still has a lot of ground to cover though to achieve its all-time high of $64,000 in November 2021 and $47,062.15 in March 2022. Ethereum has seen tremendous growth, but its price has also fallen by 50% or more on many occasions. That mining process requires a significant amount of energy, and crypto critics have raised concerns over its impact on the environment. It allows programmers to pick up digital artifact information used in the creation and sale of NFTs. Theres a group of investors that follow trends. The first step is to identify a good exchange that supports ether. But it has been going on for a good while. Buying both Ethereum and Bitcoin is asolid diversification. That means its up by $2,531.53 or 10 times over the past year. 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. The newest difference between Bitcoin and Ethereum has arisen after the completion of the Ethereum "Merge" in September 2022. So how do we make money? In October, Rostin Behnam, the chair of the Commodity Futures Trading Commission, said that Ethereum is a commodity and should fall under CFTC regulation. When interest rates are increased aggressively, it can impact people who borrow large amounts of money. For the upcoming trading day on Thursday, 2nd we expect Grayscale Ethereum Trust (ETH) to open at $7.37, and during the day (based on 14 day Average True Range), to move between $6.80 and $7.78, which gives a possible trading interval of +/-$0.486 (+/-6.67%) up or down from last closing price. ALSO READ: Why Crypto Is More Volatile Than Stocks. Therefore, Bitcoin should be a less risky investment. The network is undergoing an overhaul that would make it more powerful and attractive for launching crypto projects. There are two sides to every coin. In 2021, ethereum gained more than 400% in value, handily outperforming bitcoin's modest 62% rise (as of Dec. 31). This particular crypto crash isn't the first time Ethereum has experienced dramatic losses, either. If you find discrepancies with your credit score or information from your credit report, please contact TransUnion directly. Ethereum (CCC:ETH-USD)will likely be a better long-term cryptocurrency investment than Bitcoin (CCC:BTC-USD). This was a new high for an artwork that exists only digitally. The Ethereum network upgrade will enable ether staking, which could yield up to 15 percent for investors. Risky investments such as cryptocurrency can affect an investors total portfolio. Mark Hake writes about personal finance on mrhake.medium.com and runs the Total Yield Value Guidewhich you can reviewhere. So why does this matter if the price is still falling? If Ethereum were to disappear overnight, a much larger swath of the crypto world would also vanish. The Motley Fool has a disclosure policy. It was called the DAO: Decentralized Autonomous Organization. The biggest security threat to Ethereum happened back inMay 2016. 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. Collectively we have over 25 years of experience in cryptocurrency and we are passionate about guiding people through the complex world of crypto investing. Invest only the amount you are comfortable losing. They're both digital currencies that can be used to make transactions. And this again, the upcoming update could be one of the reasons why investors and traders might be holding it. Simply put: every four years, Bitcoin miners get half as much Bitcoin as they did before. But enough history investors want to know which is the better buy: Bitcoin or Ethereum? While crypto prices have plummeted over the past few weeks, that doesn't necessarily mean it's a bad time to buy. When evaluating offers, please review the financial institutions Terms and Conditions. Yes, investing in Ethereum is worth considering. Tesla Inc. and MicroStrategy Inc . However, the Fed has hiked 0.25 percent base points this January, as inflation showed signs of easing a bit. It also allows owners to, Ethereum is also in the midst of a multi-year upgrade. Between May 12 and May 24, Ethereum lost nearly 50% of its value. Keeping the people capable of making educated decisions is one of the many reasons why Ethereum is valuableso should I buy Ethereum now?. In October 2021, ProShares Bitcoin Strategy ETF (BITO) launched, becoming the first SEC-approved crypto-based ETF. In other words, I now believe that Ethereums price rise acceleration will shorten the period when a parity between ETH and BTC will occur. While there are currently plans in place to increase scalability and reduce gas fees, as of 2023 the costs can still be prohibitive. What Is Cryptocurrency? The math behind Bitcoin's epic rise from its inception is obviously even more remarkable. Collectively, we have over 25 years of experience in the crypto world and are all passionate about guiding people through the complex world of crypto investing. This is one more reason why 2023might be a good time to buy Ethereum and participate in the termination of censorship. One of the biggest criticisms of cryptocurrency at large has been its massive carbon footprint and high energy demand, an issue ETH has now directly addressed while Bitcoin has not. This means there is no real floor in terms of Ethereum investing. This is likely because BTC is seen as a store of value, and in times of market volatility, it is the first cryptocurrency investors would turn to. Copyright 2023 InvestorPlace Media, LLC. Funds are volatile, and transactions are irreversible. On the date of publication, Mark R. Hake held a long position in Bitcoin and Ethereum. It can be a tough burden -- but certainly manageable. Like Bitcoin, you can invest directly in Ether by purchasing coins. So should you buy Ethereum or Bitcoin? Bitcoin (BTC) was first traded back in 2009. For the second time this year, Ethereum's price is soaring. After gaining more than 460 percent in 2020, Ethereums native cryptocurrency ether has continued to rise in 2021. She's been a speaker at both CardCon (2017, 2018) and FinCon (2019). Just like the internet -- which didnt die after the 90s internet bubble -- Ethereum has gained strength and momentum. Making the world smarter, happier, and richer. Yield-hungry investors can make use of a variety of income-generating assets. 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. Ethereum's upcoming Shanghai update, scheduled for release in March this year, could be the primary driver behind the surge in the altcoin's value. As the past few weeks have proven, cryptocurrency is still an extremely volatile investment. While there might be a correction after a huge price surge, the involvement of large investors helps provide a level of price support. It should only be considered if you have a . Bargain hunters looking to buy and hold should consider these weed stocks. Ethereum looks set to break out in 2021. One of the only things standing in the way of Ethereum's continued meteoric rise is the amount of success it is currently experiencing. So let's peak at a few reasons you should consider not to buy Ethereum. Unlike Bitcoin, which is pretty much like cash for the Internet, according to Bitcoin.org, Ethereum has grander ambitions. 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. Also, new laws and regulations could pose a threat to Ethereum's future. Our estimates are based on past market performance, and past performance is not a guarantee of future performance. By contrast, Bitcoin is up by $48,044 from $7,807, or 600%. OK92033) Property & Casualty Licenses, NerdWallet | 55 Hawthorne St. - 11th Floor, San Francisco, CA 94105. Ethereum's issuance rate. Advertisement Advertisement While it continues to attract investors deterred. Ether surging to a new all-time high has caught many cryptocurrency investors' attention. Here are some key things investors should know about BTC in the Bitcoin versus Ethereum investment debate: Highest attention from large investors. Assigning Editor | Credit cards, business software, payments. Which is the better buy now? Ethereum is arguably 1 of the most liquid investment assets due to the worldwide establishment of trading platforms, exchanges and online brokerages. Theres even room for more lines. Ethereum will catch up to Bitcoin sometime within the next six years, if past performance continues. If you decide to invest in Ethereum, be sure you have a high tolerance for risk and are only investing money you can afford to lose. Before deciding which cryptocurrency to buy, you should understand the different motivations behind Bitcoin and Ether, the native cryptocurrency of the Ethereum blockchain. This would further eliminate banks and centralized third parties from the transaction process. And while our site doesnt feature every company or financial product available on the market, were proud that the guidance we offer, the information we provide and the tools we create are objective, independent, straightforward and free. With a smart contract, you dont need a third party to perform credible transactions. Thus, in 2023the safety of buying, selling, and storing Ethereum falls on the user.