Is ETH worth investing in?

Ethereum is a decentralized, open-source technology that powers much of the crypto-verse. Everything from DeFi applications and NFTs to enterprise solutions rely on Ethereum’s technology.

While early cryptocurrencies, especially Bitcoin, mainly acted as globally transferable stores of value, Ethereum has far more uses. The leading cryptocurrency on the Ethereum network, Ether (ETH), is used to cover transaction fees for smart contracts and other decentralized applications on the blockchain.

If you are interested in how to buy Ethereum, Phemex is a good option to start your investment journey. Phemex, an exchange built by ex-Wall Street vets, even offers interest on ETH deposits through its Earn Crypto program. The team’s expert asset management skills offer industry-leading returns to investors at no risk. Phemex was designed to make finance more accessible, having grown steadily to a user base of over 2 million after launching in 2019.

Contents

  • 1 Price Overview
  • 2 Ethereum and the U.S. Dollar
  • 3 Ethereum and Bitcoin
  • 4 What Analysts Are Saying
  • 5 Expert views
  • 6 Conclusion

Ethereum and the U.S. Dollar

Ethereum touched $1 during an early January week in 2016, quickly doubling in value to over $2 the next month. By July, ETH was trading for over $12, and while the token is worth well above $3,000 today, the ride up hasn’t been entirely smooth.

High volatility struck ETH markets in 2017, with prices dipping below and crossing back above all-time highs. The first serious climb happened between April and June when ETH rose in value from the $40 range to roughly $362. The next all-time high came in December, valuing the token at $826 by the end of the year.

Ethereum and Bitcoin

In January 2017, just before Ethereum’s introduction of ICOs would shake the industry unlike ever before, Bitcoin was worth 85% of the total market capitalization of cryptocurrencies. Over time, this percentage’ dominance’ has shrunk.

Many attribute this phenomenon to people selling their bitcoin at new highs to invest in smaller-cap altcoins for further speculative gains. Despite the enormous risks and scam culture that accompanied them, 2017 is referred to by many as the ‘Year of the ICO,’ with many popular tokens built on Ethereum like Golem, OmiseGO, Augur, TenX, Status, Monaco, Decentraland, and hundreds of others experiencing enormous growth.

As these blockchain projects grew, Ether’s rise in value echoed the ecosystem’s broader entry into decentralized financial services. In August 2017, ETH’s ownership of the crypto market capitalization had grown to over 22%, a little under half of Bitcoin’s 45% dominance. Within five months, ETH rose to its longest-running all-time high – $1,400, a price that was just crossed early last year.

ETH showcased exceptional performance last year, registering a new all-time high of over $4,800 in November. While the price later fell under $2500, this was amid tremendous bearish pressure from a market-wide sell-off, and prices have since recovered to above $3,000.

Despite the slight negative sentiment surrounding the project due to delayed upgrades and high transaction fees, analysts’ macroeconomic outlook appears overwhelmingly positive. Many experts claim ETH is on a path to ending this year in a more significant way than ever before, potentially even as the largest cryptocurrency by market dominance. Only time will tell whether or not these predictions will come true, but analysts have some solid reasons to remain optimistic about the longest-running smart contract platform.

For one, ETH has seen a close correlation with the price of Bitcoin. Ethereum, along with various other major cryptocurrencies, has been observed to mimic Bitcoin’s price movements. The pandemic has seen investors pour capital heavily into Bitcoin, and many believe ETH’s recent rally was fuelled by Bitcoin speculators turning their attention to the next token in line.

However, speculative interest isn’t the only reason Ethereum is on the rise. As one of the most fundamental protocols responsible for the DeFi (Decentralized Finance) movement, Ethereum is host to many DeFi projects. Over 95% of DeFi activity occurs on Ethereum, spiking increased demand for its settlement token.

Ethereum has been talking about the launch of Ethereum 2.0 for quite a few years now. The update will eventually make the Ethereum network more sustainable for DApps at scale while improving throughput and network performance at minimal cost to security.

Though the upgrade hasn’t been fully implemented, Ethereum has been making gradual progress over the last two years. Aiming to enable faster transactions, lower fees, and improved network speeds, the Ethereum 2.0 upgrade and its controversial shift in consensus model to Proof-of-Stake have certainly intrigued investors about its growth potential.

Expert views

Digital Coin Forecast: By 2024, we should see ETH valued at around $4940.

Wallet Investor: We expect a long-term increase in the price of ETH. The price prognosis for 2027 is $14505.30. With a 5-year investment, revenue is expected to grow by around 406.05%.

Trading Beasts: According to us, ETH might cross the $3000 price mark by 2022. The maximum price could be around $3305, with the lower boundary at around $2247. The average price of Ethereum for December 2022 could be about $2644.

Ethereum shows so much promise and has support across the industry. Ethereum’s technology is at the core of many of today’s most innovative blockchain applications. Many believe that blockchain will play a significant role in the future of finance and financial services, making investing in Ethereum an incredibly lucrative value proposition. Of course, like with any high-reward investment, make sure you understand the risks involved with investing in cryptocurrencies and do your own research before making any purchases.

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