Should You Invest in Ethereum and Where to Buy Ethereum?
Ethereum price has soared and it has outperformed many other cryptocurrencies recently. Given the investment interest displayed by Ethereum enthusiasts, should you invest in Ethereum or not? If it is worth investing, where can you buy Ethereum? Is Ethereum a good investment? Read on and find out the reasons why you should invest in Ethereum.
Disclaimer: The content on this site is provided as general information only and should not be taken as investment advice. The opinions expressed in this article are the personal opinions of the author at the time of publication.
Should You Invest in Ethereum?
Ethereum was developed with Smart Contracts and computation in mind, making it a more powerful and versatile platform than Bitcoin for performing more than financial transactions. Some analysts predict that Ether could eventually rival Bitcoin, in both volumes of usage and versatility as a platform for computation and cyber security. Read more on What Is Ethereum and How to Make Money With Ethereum?
If you are wondering the legitimacy and the future of Ethereum, an organization called the Enterprise Ethereum Alliance (EEA) was recently set up to connect large companies such as JPMorgan, Microsoft, and Intel to technology vendors in order to work on projects using the blockchain. Given Ethereum’s maturity and multi-purpose design, it is the most promising solution for enterprise Blockchain adoption.
In short, it has spiked recently because of the big names who believe in it. This was covered heavily by the media, resulting in the bullish trend we are witnessing. IMO it’s a safe bet that Ether will continue its rise.
Now we have seen the hike in its price, will it continue and become the next Bitcoin? The next big question is should you invest in Ethereum? Here, I outlined a few reasons why you should consider treating it as your long-term investment portfolio. Before that, have a look at the background of Ethereum and see the future in it.
#1 Future Investment
Ethereum is notably one of the valuable platforms. With the global FinTech industry shifting towards blockchain technology-based applications to suit their requirements, smart contracts, and automation of financial processes takes precedence.
Ethereum is tailor-made for such applications. Whatever the reason is, it still increases the demand – meaning a further increase in Ethereum price.
As the demand for the Ethereum platform and its smart contracts enabled network increases, the value of Ethereum as a cryptocurrency will continue to surge.
Ethereum has a future as a platform for real world commerce. There is plenty of evidence to reflect that Ethereum projects will provide genuine value in interbank transactions, B2B remittance based transactions and Smart Contracts connecting to the internet of things.
Even though the price of Ethereum has already appreciated significantly in 2017, there is still 10x, maybe even 100x long-term upside from current levels. Ethereum hasn’t come close to mainstream adoption yet, but there are hundreds, possibly thousands of applications in development.
Just check out the. That’s a huge amount of development. As more useful services are built the value appreciates. These above companies see that value and are no doubt considering their own implementations.
As more people begin developing Decentralized Applications (DApps), whether it be for the Internet of Things, governments, corporations, small businesses, or individual artists, there will be an ever-increasing demand for Ether.
Ethereum had an organic growth, without massive spikes, and it seems to be stable, if not even predictable.
Even with the cyber attacks and a history of hard forking, Ethereum’s blockchain remains in demand. The price of its cryptocurrency, Ether (ETH) remains fairly stable. ETH took advantage of destabilization, providing a low-cost alternative.
While there are few investing in Ethereum for its future potential, there are those who just follow the trend. The increasing demand and value of a certain cryptocurrency serve as an indicator of its potential. Whatever the reason is, it still increases the demand – meaning a further increase in Ethereum price.
Rather than focusing on the price, now let’s take a look at the following chart.
There are currently about 1/3 as many transactions on the Ethereum blockchain as the Bitcoin blockchain, but Ethereum is growing exponentially, while Bitcoin has reached its maximum capacity for now.
Cryptocurrencies have a very strong network effect. The more people using it, the more utility and value have. It is highly likely that the value of Ethereum will increase as usage increases.
#3 Security is great with Ethereum
Smart contracts with yourself. There’s no point in receiving money unless you can secure it, and securing private keys is hard.
You can make a multi-sig address and put the keys in cold-storage, in bank vaults on multiple continents, but that makes it hard for you to spend. You can have an access key that you keep with you on your phone, but it’s hard for you to secure.
With the bank account, there is some logic creating transactions on a monthly basis. That code sits on one computer and is executed by one party (the bank). There are internal controls and reconciliations, but there is no external validation.
With smart contracts running on a blockchain, the logic is run in parallel on all the participating computers, and the results are compared with all participants. Participants only change their own version of the ledger if they agree with the results. No one can cheat a blockchain, in theory.
Ethereum is a public blockchain platform which is currently the most advanced smart contract enabled blockchain. With a “Turing complete” coding system, theoretically you can put any logic into an Ethereum smart contract, and it will be run by the whole network. There are mechanisms in place to prevent abuse, and you need to pay for compute power, by passing in “ETH” tokens, which act as payment for the miners who run your code.
In short, Ethereum stands out amongst the current crop of Blockchain technologies as being the best hope we have of developing a platform that can actually deliver on the high expectations that people have set for Blockchain.
#4 Superb Team of Ethereum
Vitalik Buterin, a programmer from Toronto, first grew interested in bitcoin in 2011. Buterin learned about Bitcoin when he was 17, and soon after (in 2012) won the Bronze Medal at the International Olympiads in Informatics.
He co-founded the online news website Bitcoin Magazine in the same year, writing hundreds of articles on the cryptocurrency world. He went on to code for the privacy-minded Dark Wallet and the marketplace Egora.
He also serves as the chief scientist of the Ethereum Foundation, a Swiss non-profit organization where he helps to maintain the core technology of the cryptocurrency.
After Buterin unveiled the Ethereum white paper, other developers participated in the project.
One of the co-founders, Dr. Gavin Wood wrote the Ethereum yellow paper, the “technical bible” that outlines the specification for the Ethereum virtual machine (EVM) that handles the state of the ledger and runs smart contracts. Another co-founder Joseph Lubin went on to found the Brooklyn-based ConsenSys, a startup that focuses on building decentralized apps.
The team behind Ethereum is very smart. I always look up the people that are behind a project before investing and Ethereum has 100% of my confidence.
#5 Ethereum Foundation Strikes Deal with Russian Development Bank
The most recent news in August 2017 was the Ethereum Foundation will work together with the VEB to support its new blockchain research center, providing specialist training for distributed ledger technology and the ethereum platform. The partnership hopes to help foster a community of ethereum experts within Russia and to assist the formation projects based on ethereum and other blockchain.
The union is intended to create a new Blockchain technology training program in order to move Russia forward in the Blockchain world. The program will produce educated and trained Blockchain experts for use and help in state-owned corporations as well as government bodies.
The impact on Ethereum is extremely positive in the short term. Additional partnerships, especially with government bodies, create much greater chain stability and confidence, as well as use. Prices should respond positively to this partnership.
Should I buy Ether now?
I don’t know about you, but I regret not buying Bitcoins when they cost fractions of a penny. Now they’re worth more than gold. But if you’re ever going to get a second chance, this might be it. Could ETH be the standout altcoin that gives Bitcoin a run for the money? We will never know.
As Ether functions as a commodity for it serve as exchange token to operate the Ethereum Virtual Machine (EVM) that makes possible computer operations on the blockchains and the use of smart contracts. Besides this intrinsic use, it can be exchanged, traded or transfer with no limits. In the future, there will be even the possibility of doing it totally anonymously through a similar protocol as ZCash, but as an option, not as default.
The development team is brilliant, the product vision is right on, the partnerships in place (Microsoft, to name one) are highly undervalued, and the third parties working on hundreds of applications for the Ethereum blockchain will drive exponential growth.
Ethereum is a new protocol, an improved platform that builds on the brilliant invention of the blockchain, the technology behind Bitcoin. Ethereum is like Bitcoin 2.0. It can do more than Bitcoin without the baggage. If it goes smoothly, it is going to be huge and everyone will live and breath Ether. Of course, we always hope for the best thing to happen.
At the time of writing, Ethereum and other cryptocurrencies are growing in value like crazy, but there is still a lot of uncertainty in the industry. An entire blockchain could have a critical vulnerability that makes it worthless, taking the rest of the market with it.
Ethereum has strong corporate support, which has helped propel its rally.
Japan helped bring Bitcoin into the mainstream by passing legislation that allows it to be accepted as a legal currency. It has limited supply, has also seen it reach safe haven status – like gold. The ascent of Bitcoin has helped fuel demand for other cryptocurrencies, such as Ethereum.
There is a great potential with Ethereum, but this also comes with great risks. Invest wisely.
Like Warren Buffet would say never put all your eggs in one basket. I invested in ETH early this year and it has been a profitable investment. I didn’t stop at investing in ETH until today because I believe in the project, the team, and their vision.
People have made millions with Bitcoin, some with luck some with research, but of course, history doesn’t dictate the future. I always buy a few coins of cryptocurrencies that have shown some sign of actual worth, as a punt.
Hence, if you are totally new to the world of cryptocurrency, start with a small amount of ETH. Observe and do your research from time to time.
Will Ether Price Drop off the Chart?
On 21 June 2017, someone sold $30 million worth of Ether and sent the price down to $0.10. The flash crash has caused many investors lost a few thousands of dollar within a second as the drip triggered a series of stop loss orders.
Can this happen again in the near future?
In my opinion, there are two reasons that can possibly cause a downfall of Ether price, a repeat of Mt. Gox‘s incident and the influx of Initial Coin Offerings (ICO).
#1 Major Exchange Outage
Almost every market crash is a result of panic selling due to the lacking of proper evaluation of the fundamental of a market condition.
Although the standards in cryptocurrency exchanges have considerably increased since the devastating bankruptcy of MT Gox which lost almost one billion dollars as valued at the time, there is still a possibility that the exchange is hacked like Bithumb. The hacking has caused monetary losses from compromised accounts have started to surface, and are quickly reaching into the billions of won.
#2 Initial Coin Offerings
Ethereum is way more than just a cryptocurrency as it is also a platform which offers decentralized services based on the blockchain. Its underlying currency is Ether. It’s also a project which helps start-up launch their decentralized services, raise funds through ICO.
At the time of writing, there are more than 20 offerings being carried out a month. You can check the ICOs and Crowdsales on Smith + Crown website. According to Smith + Crown, there have already been more than $150 million raised this year through ICO.
If you pay enough attention, there is a slight correlation between the ups and downs of the Eth price and the crowdfunding closing dates.
Although this may not be entirely right, there is still a big risk where the Ether raised by these ICO will be retained or dump on exchanges for fiat.
One prime example is Bancor Foundation that raised more than $150 million worth of Ether by offering their own token. Once the tokens were sold out, ETH was priced at $410, and drop to $310 a few hours later. Coincidently, Coinbase has crashed along with GDAX exchange and users are unable to sell or buy.
Could this really be a coincidence?
You can find more information on What Can Cause Ethereum Price Falls off the Charts?
Where to Buy Ethereum?
There are a number of apps and sites that allow you to buy Ether. Many of these also allow you to buy Bitcoin too if that takes your fancy.
I buy my Ether at Coinbase.com. They have pretty tight security and a decent little app that has fun graphs and lets you buy digital currency using a credit card.
Coinbase established itself as a Bitcoin exchange in 2012. The platform is convenient to access and use, adapts to industry advances and positions itself as a platform to buy and sell Bitcoin and Ethereum.
Coinbase is a secure online platform for buying, selling, transferring, and storing digital currency. It is currently based in San Francisco and it is backed by many capitalists, most notably Union Square Ventures and Andreessen Horowitz.
Coinbase is available in more than 30 countries such as the United States, United Kingdom, Canada, Singapore, and the following European countries: Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Finland, France, Greece, Hungary, Ireland, Italy, Latvia, Liechtenstein, Malta, Monaco, Netherlands, Norway, Poland, Portugal, Romania, San Marino, Slovakia, Slovenia, Spain, Sweden, Switzerland.
IMPORTANT: They also have a referral program that pays out $10 when you pay in $100 as an initial investment (or the equivalent in pounds or euros).
Read Coinbase background and step by step to purchase Ether here.