There are many reasons why you might want to invest in Ethereum . Many think they need to be an experienced investor with a lot of capital, but with a little common sense and research, investing in cryptocurrencies is quite accessible, even for beginners.
The cryptocurrency market is booming right now and it’s quite understandable to be confused as to which altcoin to choose. While many have great potential, Ethereum stands out as one of the best cryptocurrencies to invest in .
The second largest cryptocurrency by market cap is outpacing most altcoins in terms of earnings, and many think Ethereum can beat Bitcoin to become the world’s largest cryptocurrency by market cap .
For those people who want to build a profitable cryptocurrency wallet, there are so many reasons to invest in ETH now. For context, here are the reasons why you should invest in Ethereum today .
The reasons why you should invest in Ethereum today
There are so many reasons why you might want to invest in Ethereum, and probably some you’ve never considered will make you realize that Ethereum is a great long-term investment. Let’s see together the reasons for investing in this cryptocurrency.
Ethereum Virtual Machine opens the doors to the future
Ethereum Virtual Machine is one of the biggest strengths of the Ethereum blockchain. It is a complex programming system that allows people to build virtually anything on Ethereum.
Since the start of the project, thousands of complex smart contract programs have been developed on it. Many more are coming, especially now that the world understands the potential to build on Ethereum. Since these projects have to buy Ethereum in order to use the EVM, it means that long-term demand for Ethereum is guaranteed .
Ethereum is the second largest cryptocurrency
The market capitalization of a cryptocurrency is important, Ethereum is in second position, behind only Bitcoin. A project can be great, but if it’s positioned so low that people can’t easily notice its existence, it may be difficult to get traction.
Ethereum does not have this problem. As previously mentioned, it is the second largest cryptocurrency by market capitalization, which means that even a cryptocurrency novice can see Ethereum, alongside Bitcoin when it first enters this market.
This was instrumental in attracting liquidity to Ethereum and supporting its demand. With cryptocurrency awareness on the rise, this is a factor that could see Ethereum steadily gaining over the years.
Ethereum’s price growth potential is high
Ethereum hits new highs every day and has currently crossed the $ 3,000 mark. While this price may seem high, Ethereum still has plenty of room for growth. This is due to the greater diffusion of cryptocurrencies globally.
People now see cryptocurrencies as a legitimate alternative investment to traditional investments like stocks and real estate. This means good news for cryptocurrencies with strong foundations like Bitcoin and Ethereum. If Ethereum’s growing popularity in token launches is anything to build on, Ethereum can hit $ 10,000 or more in the near future .
Ethereum’s technical analysis supports the rise in prices
Pro-traders use a combination of technical and fundamental analysis before placing their trades. In the case of Ethereum, the technical indicators are largely bullish .
Cryptocurrency volume indicators show buying pressure is high and rising. The same is supported by the moving average where short term exponential moving averages are trading firmly above the 100 and 200 day moving averages.
With bullish technical data, supported by strong fundamentals, Ethereum is in a good position for further gains in the short and medium term . Its current price action reflects this reality.
Ethereum is gaining ground in institutional adoption
Ethereum has been gaining in adoption over the years and this will only grow over time. This is quite evident in the composition of the Enterprise Ethereum Alliance (EEA).
This is an alliance made up of some of the largest institutions in the world, including JP Morgan. As decentralization takes root in society, these institutions will rely even more on Ethereum and increase the demand for ETH. This is a factor that will see Ethereum’s level rise in value in the future. That’s a huge reason to be optimistic about Ethereum.
Ethereum has the ERC20 standard
The ERC20 standard is probably one of the most significant inventions on Ethereum . It paved the way for an explosion of projects on the Ethereum blockchain. Today, a huge chunk of projects in the cryptocurrency market are ERC20 tokens. The explosion of these tokens followed the 2017 ICO bubble.
Since then, the number has continued to grow with new innovations such as DeFi and NFT, further opening up the adoption of the Ethereum blockchain. As more of these ERC tokens enter the market, Ethereum’s value will rise.
Ethereum 2.0 is a game changer
Ethereum 2.0 is a big step forward and will take Ethereum to new highs in the long run . Ethereum 2.0 is a transition of Ethereum from a Proof-of-Work blockchain to a Proof-of-Stake. The move solves two problems. The first is that of scalability and transaction costs.
As there will be no miners, the increased cost of gas that has been a challenge in the past will be non-existent after the full transition. Second, the change will make Ethereum more environmentally friendly, a factor that could attract environmentally conscious investors, especially institutional ones.
Ethereum has a first mover advantage
Ethereum is the world’s first blockchain platform and cemented its place in this market with the ICO boom of 2016/17. Since its launch, many others have come out like Cardano. However, none of them have Ethereum’s market reputation.
This explains why most new projects are still being launched on Ethereum despite its competitors positioning themselves as more efficient. Furthermore, now that Ethereum is switching to Ethereum 2.0, most of the advantages its competitors flaunt will be neutralized. This will have the effect of increasing its market share and, by extension, its price.
Ethereum has a quality developer team
Ethereum has one of the best teams of cryptocurrency developers, rivaled only by that of Bitcoin. A person like Vitalik Buterin is an IT expert and was already creating scenarios for scaling solutions long before the current transition.
With such a team of developers in Ethereum, investors can expect this cryptocurrency to continue to grow in value . This is because it is an anchor for its long-term growth, especially in the adoption of new ideas that are coming into the crypto space. This is also a key factor in getting institutional actors involved in the long term.
Ethereum is one of the most decentralized cryptocurrencies
In the crypto space, decentralization is the key to success. Quite logical considering that decentralization is the whole essence of the market, for both freedom and security.
The decentralized nature of Ethereum is in the different nature of its miners. Just like Bitcoin, no single miner or group of miners controls the Ethereum mining process.
Ethereum 2.0 is also quite decentralized and no single group of people controls the amount of Ethereum staked. Ethereum is so decentralized that not even Vitalik Buterin can dictate the direction of Ethereum. This is a key security guarantee of Ethereum and will play into its long-term value .
Ethereum is time tested
Ethereum is one of the oldest blockchain platforms on the market and carries a significant volume of most projects ever launched. This also means that it has been tested to its full potential and the updates it makes are based on market realities. Many of its competitors use untested metrics and risk failure.
For context, the Binance chain recently saw a rise in gas prices despite using cost and scalability as a key selling point. Ethereum’s resilience is a huge bullish sign , which could see its value increase significantly over the long term.
Ethereum has many long-term supporters
One of the key indicators of a project with long-term potential is the number of people investing in it over the long term. Ethereum is one of these projects. Since the launch of Ethereum 2.0, the amount of Ethereum staked has increased and now stands at over 4 million.
This is an indicator that there are many wealthy people who firmly believe in the viability of Ethereum as a long-term investment . This is a factor that could see its value grow significantly in the long run and makes it a good investment at current prices.
Ethereum enjoys a lot of media hype
The media hype surrounding a cryptocurrency plays a major role in its price action. Whenever a project is in the news for positive reasons, its price tends to rise.
Ethereum is drawing all the press to it. Some of the biggest names in cryptocurrency have spoken of Ethereum as a potential big engine that could outperform Bitcoin not only in terms of earnings, but also in market capitalization . Such positive printing is the key to Ethereum’s long-term value growth.
Ethereum is one of the safest blockchains
Security is one of the safest blockchains on the market, mainly due to its long UTXO. At the moment, it’s still a Proof-of-Stake blockchain and anyone trying to compromise it should generate a near-impossible level of hash power.
Even after switching to Proof of Stake, it will be nearly impossible to compromise it. This is due to its price and the huge amount of Ethereum wagered. It would be almost economically useless to attempt to compromise it successfully. Its security is one of the key factors that make Ethereum a viable investment, both now and in the future.
Ethereum is a store of value
Ethereum is one of the cryptocurrencies that some institutional players believe is a sustainable store of value. This places it in the same league as Gold, Silver and the real estate market.
It’s a big deal as trillions of dollars are invested in valuable assets like gold and silver. If any part of this amount is spent on Ethereum, its value will grow exponentially over time. It’s a huge confirmation that Ethereum is a great long-term investment .
Ethereum has many DEXs like Uniswap
All transactions on the Ethereum blockchain require Ethereum (ETH) to be executed. This is a big plus because the huge number of DEXs running Ethereum projects creates endless demand for Ethereum.
One of the largest DEXs holding the key to Ethereum’s long-term growth is Uniswap.
Uniswap is a relatively new project but now manages up to $ 5 billion in weekly transactions. This could help anchor Ethereum’s value for years to come.
Ethereum has an easy to understand programming language
The growth of the Ethereum blockchain is based on the number of projects launched on this blockchain. In order for people to choose this blockchain over other blockchain platforms, the programming language used must be easy to understand.
Ethereum uses Solidity, a programming language that is easy to learn and understand . This means that anyone with a solid understanding of other languages like Python and C ++ can easily learn solidity. This explains why the language is growing in popularity. The ripple effect of its growth will be an increase in the launch of projects on Ethereum and subsequent growth in value. This is a great reason to bet on Ethereum for the long term.
Ethereum is favored by better regulation of cryptocurrencies
Cryptocurrency regulations are improving around the world. In many jurisdictions, cryptocurrencies are now commonly accepted as legal tender. Even in major markets like the United States, regulations are improving.
This is evident in the Senate confirmation of a cryptocurrency pro person as chairman of the Securities and Exchange Commission. All of this works to Ethereum’s advantage. As the second largest cryptocurrency by market capitalization, Ethereum’s value will be increased by the huge number of investors who are attracted to cryptocurrencies by better regulations.
Ethereum is present on a large number of exchange platforms
The number of platforms Ethereum is present on is important as it can affect liquidity and appreciation of value. The more you trade, the more liquidity and potential for price increases.
On this front, Ethereum is second to none. In addition to the fact that it is present on virtually all existing cryptocurrency exchange platforms, almost all of them are dominated by Ethereum’s ERC20 tokens.
This is a big advantage because as long as the cryptocurrency market grows in adoption, the ease of accessing Ethereum-based tokens will have an impact on its growth in value.
Ethereum is easy to store
There are many cryptocurrencies, including Ethereum competitors who do not yet have a functional wallet. This can be quite limiting for investors who fear leaving their crypto assets on the stock exchange.
Ethereum does not have this problem. There are many easy-to-use wallets where you can store your Ethereum. The best of these is Metamask . Not only is it secure and decentralized, it also offers instant access to thousands of ERC20 tokens without the need to go through third parties. This is a big reason to invest in Ethereum now, given the current explosion in cryptocurrency adoption .
Ethereum will benefit from the overall growth of cryptocurrencies
The entire cryptocurrency market is on a bullish trajectory and has crossed the $ 2 trillion mark . Naturally, this has brought the market to the fore and attracted more retail and institutional investors. This is a big plus for ETH and other cryptocurrencies because as more investors enter the market, so too will the market value.
For cryptocurrencies like Ethereum being among the most dominant in the market, this could see its value increase exponentially over time. That’s a good reason to buy Ethereum now.
Ethereum is a forward-looking crypto project
Ethereum is one of the most forward-thinking cryptocurrencies on the market. In terms of content, the project has responded to the problem of carbon emissions, costs and scalability by launching Ethereum 2.0.
Since Ethereum 2.0 is Proof-of-Stake, it reduces the cost of gas by facilitating transactions on this blockchain. It also alleviates the problem of emissions by eliminating miners. Such progressive moves will keep Ethereum appealing to investors and increase its demand. It is a compelling reason to buy Ethereum now.
Ethereum dominates on its forks
All decentralized blockchains can be forked. While this has had the effect of neutralizing most of them, Ethereum is among those that are strong. Its first fork was after the DAO hack which resulted in millions of dollars in losses.
It remained strong and dominated its sister chain Ethereum Classic. Lately, miners have been talking about the Ethereum fork following the Berlin updates. However, the project has stood still and is set to become a Proof-of-Stake blockchain and get rid of the miners altogether. This is a sign of a strong chain, with a firm community behind it.
Ethereum will benefit from the DeFi and NFT revolutions
If there has still been a reason to invest in Ethereum, then DeFi and NFT should be at the top of the list . These two innovations are changing everything from the world of finance to music and art. Recently, a digital artwork sold for $ 69 million, making it a record holder for one of the most expensive digital artwork ever sold. The best part is that most of the DeFi and NFT markets are based on Ethereum. Therefore, as these two grow, the value of Ethereum (ETH) will also grow.
There are many reasons to believe in the long-term growth of these two markets. The first and most important is speculation.
Taking DeFi as an example, investors are increasingly betting on Ethereum in projects like Yearn. Finance and Compound for the enticing returns that come with it. As more and more people discover the profit potential that exists in storing Ethereum in profitable projects, the value of ETH will also grow. Such world-changing innovations are a great reason to invest in Ethereum with the aim of both short and long-term gains.
Ethereum ETFs are coming
Bitcoin ETFs have been the focus of attention for some time, however, due to regulatory hurdles, they have not become a reality in the United States, the largest economy in the world.
Things are about to change with the arrival of a pro-cryptocurrency SEC president . Once that happens, Ethereum will become one of the cryptocurrencies that will have its own ETFs alongside Bitcoin and a few others.
There are already some suggestions for such a possibility. Big banks, such as JP Morgan, which are inventing products focused on cryptocurrencies, have indicated their bullish outlook on Ethereum.
Once products like ETFs become a reality, the excitement they create in the market could lead to a huge increase in its demand over the long term. In anticipation of such a price hike, coupled with its current price hike, it makes a lot of sense to invest in Ethereum now.
Ethereum could benefit from investors switching to altcoins
Bitcoin has gotten quite expensive lately and is currently trading between $ 55,000 and $ 60,000. This means that it has blocked many small investors who may have wanted to buy an entire unit of Bitcoin.
However, even for those looking to purchase small units, the transaction costs have skyrocketed. This has seen the momentum shift more towards altcoins.
This is quite evident in the decline of Bitcoin’s market dominance which now stands at 49%. As its market dominance wanes, one of the altcoins they are reaping from changing dynamics is Ethereum. Ethereum is benefiting from its use cases which increase its growth prospects.
It is also the second largest cryptocurrency, which makes it one of the cryptocurrencies that have been raising big since the altcoin boom. Ethereum is also driven by investor hopes that it will repeat Bitcoin and likely trade at over $ 10,000 in the short term .
Bitcoin has already shown investors that anything is possible in the cryptocurrency market. For this reason, it makes sense to invest in Ethereum as an asset that has great earning potential in the short and medium term. If its current rally is anything to build on, then Ethereum has a lot of potential for the short term. It started the year under $ 1000 and has steadily grown to its current sub-$ 3,000 levels since then.
You might be interested in: How to invest in Ethereum
Ethereum (ETH) Live Chart
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How to invest in cryptocurrency CFDs
To invest in cryptocurrencies (Bitcoin, Ethereum, Litecoin, etc …) there are more possibilities, but certainly the simplest one is through trading on cryptocurrency CFDs .
Among the advantages of trading cryptocurrencies through CFDs is being able to trade 24 hours a day, even on weekends. Furthermore, with CFDs it is possible to ‘bet’ both upwards and downwards , thus having the possibility of gaining (or losing) both during the bullish and bearish phases.
Furthermore, CFDs on cryptocurrencies can count on the leverage of 1: 2 for retail investors. This means that by investing € 1,000, the position on the market will be double, € 2.00. Leverage has the advantage of doubling your profits but exposes you to greater risk if prices go in the opposite direction to that chosen.
To start trading cryptocurrency CFDs, you will need to:
- Open an account (With 101Investing you only need 250 euros)
If you trade with CFDs, it is not necessary to have a specific conversion account for cryptocurrencies or a wallet. What you need is simply an account with a broker who offers leveraged products.
- Inform you
Cryptocurrencies are not affected by all those factors that normally impact traditional currencies. However, it is important to have full knowledge of the market in which you operate.
- Use a strategy
Your trading strategy will depend on your goals and preferences. Deciding which strategy is right for you is critical to short- and long-term success.
Enter the number of contracts for your position, define the terms for closing the position and click on “buy” if you believe that the value of the virtual currency will increase, or “sell” if you believe it will fall.
- Close the position
Once you have reached your goal, or if you believe it is better to stop the losses, you can close the position by placing an order opposite to the opening one: if you bought, you must sell, if you sold you must buy.
Where to invest in cryptocurrencies with CFDs
Investing in cryptocurrencies is one of the favorite activities of many people who wish to ride the enthusiastic rally of digital currencies. Thanks to CFDs, anyone can easily access the financial markets and buy cryptocurrencies (or other types of assets such as stocks, currencies, commodities, etc …), even with a small starting capital.
Online brokers such as 101Investing (see 101Investing review here ) provides a series of tools to invest in major markets in a simple and safe way thanks to cutting-edge trading platforms that can be used from any PC or smartphone.
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