Is Ethereum a Good Investment? Here are the Pros and Cons of ETH

The cryptocurrency market continues the bearish trend that started earlier in the year. So is Ethereum (ETH) now a viable cryptocurrency to buy? Given that the world economy is expected to enter recession in 2023, this is a legal question. Also, as reported, it is rumored that the Central Bank will raise interest rates up to 100 basis points.

EthereumIs it worth investing now?

As Ethereum is the second largest blockchain platform, many crypto experts believe that ETH is an adequate investment compared to other cryptos. One of the factors that will affect investing in ETH in 2022 is Ethereum 2.0. Ethereum 2.0 focuses on power efficiency and staking rather than mining. Note that proof of stake includes active process verification and network abutment by keeping funds in a crypto wallet to ensure security. Another reason for investment is the increasing use of blockchain technology. This technology can facilitate online payments, credit distribution and commodity trading.

Since its launch in 2015, ETH has given its investors a high return of 284,861.87%. However, market dynamics are always changing and in the middle of 2015 and 2017 the market situation is slightly different than it is today. At that time, retail money was the main driving force of the market. Today, institutional money plays an even more valuable role in the market, and there are many regulations. With all these changes, it’s natural to wonder if ETH is a decent investment today. Let’s take an in-depth look at the advantages and disadvantages of buying ETH. To begin with, below are 8 reasons why Ethereum is now a worthwhile cryptocurrency to invest in.

Advantages of investing in Ethereum:
1-Ethereum has real-world use

There are many cryptocurrencies that have no real use besides speculative trading. In fact, a large number of altcoins fall into this category. Ethereum is one of the most recognizable cryptocurrencies with high utility. Ethereum use cases range from DeFi to NFTs. In terms of context, all of the most adequate DeFi cryptocurrencies on the market today are Ethereum-based. In precedent form, all the most beautiful NFT cryptocurrencies such as ApeCoin, Decentraland and Axie Infinity are based on Ethereum.

Ethereum’s dominance in various crypto use cases has two advantages. The first is that the demand for ETH tokens will surely increase into the future. Second, investors seeking a mix of value growth and some stability elements will increasingly see Ethereum as a smart cryptocurrency investment. The result could be an increase in the cost of ETH as broader market factors become favorable to the cryptocurrency market.

2-Ethereum is now more environment friendly

Environmental issues have become a major concern for investors in all markets. Because the world is warming and it is everyone’s responsibility to leave a livable planet to future generations. Therefore, cryptocurrencies with a low environmental footprint are becoming more attractive, especially for institutional investors. Ethereum has taken important steps by switching from the Proof-of-Work algorithm to the Proof-of-Stake algorithm. The transition started in 2020 and was completed last month. Ethereum’s carbon footprint will now be less than before.

This transition makes Ethereum attractive to institutional investors, who are mostly socially responsible to their backers. This could see the demand for Ethereum increase. However, it could make it a high-potential cryptocurrency to invest in.

3-Ethereum is censorship resistant

Recently, there has been an increase in bets on censorship on the Internet. Big tech companies have a lot of power. So they can determine what is being said and not said on their platform. ETH comes as an answer to the censorship woes, and at this point it’s invaluable. Ethereum is robust against censorship as it does not have a central point of control. This means that no one can shut down Ethereum; By extension, data stored on Ethereum cannot be stopped, not even by the government.

This factor could see more Dapps being launched on the Ethereum blockchain going into the future. This increased demand will likely translate into a higher price as Dapps require ETH tokens to launch on Ethereum. This is why ETH stands out as a fairly low-cost crypto today. The price is low, but the potential demand is high.

4-Ethereum has the potential to define the internet again

The internet has changed the world. Billions of people are connected to the internet today, and trillion-dollar companies have their origins in the internet age. Now imagine Ethereum changing the world as it is today and becoming a world computer. Since its launch, ETH has enjoyed a surge in popularity as a launch platform for decentralized apps. This use case continues to grow and is used today as a launchpad for all kinds of smart contracts. ETH is used to digitize various assets in a decentralized environment.

As this adoption grows, so does the growth in Ethereum’s popularity. This puts Ethereum in a unique position to become the world’s largest and most valuable decentralized computer, reshaping the internet in active form. In time, multi-billion dollar decentralized organizations with global influence will be working on Ethereum, which is a big deal in terms of potential price growth of ETH. While adoption is now in its infancy, making Ethereum a smart cryptocurrency investment today.

5-True local administration proves to be an asset

Ethereum is one of the most decentralized cryptocurrencies on the market. So why is Ethereum decentralized valuable? In the last few years, it hasn’t been that valuable. Multiple of the top performing cryptocurrencies in the 2020/21 bull run were heavily centralized. For example, many of the best performing ETH alternatives often have an element of centralization.

But things are changing and investors are starting to realize that decentralization can be one of the most valuable assets you can trust in this market. The collapse of Terra, a $40 billion project, supported this. The fact that Celsius and several other cryptocurrency platforms have moved to limit withdrawal processes has also made it clear the importance of decentralization. The power of decentralization makes Ethereum a very low-cost cryptocurrency at current prices.

6-Ethereum tokenomics is changing

Since the hard fork in August 2021, Ethereum has experienced a major change in tokenomics. Unlike in the past, the more ETH is adopted, the more ETH is burned. This was the reason why Ethereum rose from around $1,000 in August 2021 to $4800 by December 2021. Going into the future, further adoption of Ethereum is possible. With the growth possibilities of the market such as DeFi and NFTs, Ethereum’s burn rate will accelerate. As a result, the price of Ethereum could rise exponentially as demand outpaces supply going into the future.

7-Ethereum manages the competition very well

The Ethereum blockchain has faced a lot of competition since 2017. This was followed by the rise of many ETH killers trying to dethrone Ethereum from its position as the number one Dapps platform. However, none of these competitors has managed to dethrone Ethereum from its top position in the last 5 years. This has a lot to do with the fact that many have focused on decentralization value, scalability and process pricing. It will likely see Ethereum consolidate its position as the number one Dapps platform in the market. This gives an edge in terms of adopting Ethereum.

8-Ethereum is available on many exchanges

ETH is one of the few cryptocurrencies listed on all exchanges large and small. This is an advantage for Ethereum as it will always be a liquid asset that investors can enter and exit at any time. In a market as high-risk as cryptocurrencies, this is a huge plus. This is because traders know that they can easily buy and sell based on current market conditions.

Disadvantages of investing in Ethereum

While ETH is one of the most affordable cryptocurrency investments with great potential, it is not without its problems. There is also a possibility that Ethereum will underperform or fail the market. Although ETH maintains its position as the number one Dapps platform in the market, the number of competitors is increasing. Some of the newer ones perform quite adequately on key metrics such as security and decentralization. This means that there is a risk that Ethereum will see a drop in its market share over time. The one-to-one thing could also be reflected in the price in the form of ETH, which underperforms the broader market.

Besides, cryptocurrencies are always at risk of bad actors. Ethereum has had its stake in malicious attacks. For example, it suffered a hack in 2016 and the Ethereum DAO lost $70 million. However, the community took action to restore the funds through a hard fork. More recently, a 7-block reissue of the Ethereum blockchain has posed a threat.

Is it too late to buy Ethereum?

Many crypto market analysts seem quite optimistic about ETH. There is also a general consensus that its value will increase in the near future. However, there is no clear consensus on how high Ethereum can reach. If that’s the case, it might be the ideal to buy now, and you could even call it ‘cheap’.

Does Ethereum have a future?

There is no critical reason to suggest that Ethereum will not last until the next 10 years. However, there are technical risks worth mentioning. The biggest one is that Ethereum has no end on the total number of tokens that can be made. Because of this, it has an inflationary structure. This means that if a large number of ETH tokens are thrown into the market, the value of the assets in everyone’s hands will decrease.

How reliable is Ethereum?

ETH is largely believable. Like almost all cryptocurrencies, Ethereum uses blockchain technology to protect itself against attackers. As Ethereum’s network continues to grow, having more nodes makes it harder for attackers to manipulate it. Thus, he will become more faithful. This is because the combined computing power of all nodes in the network would be very difficult for attackers to overcome. Note that many of the attacks where ETH was stolen took place on cryptocurrency exchanges, not on the Ethereum blockchain.

Conclusion: Is ETH a Sufficient Investment?

The price of an ETH token was $25 in 2017 and reached $3,409 in early 2022. So, if you had invested $100 in Ethereum in 2017, you would have about $100,000 in Ethereum by now. So is Ethereum worth buying? Currently, Ethereum is considered an absolutely adequate investment. And if you want to invest in it, now is probably the right time to do so. It is very valuable to understand what you need to know before investing in Ethereum. In the end, the final decision falls to you. What kind of investor do you want to be? Find the answer to this question and you will know for sure if Ethereum is an adequate investment!

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