What Makes Ethereum a Great Investment Tool ?

Cryptocurrencies investment is like a modern-day gold rush. They are easy to trade, cannot be duplicated, and it is easy to track them as they are traded. Do you know there are around 4000 cryptocurrencies in existence as of January 2021? However, not all are popular among investors. Most people are interested in investing in top cryptocurrencies. 

What Makes Ethereum a Great Investment Tool

Facts About Ethereum

Launched in 2015, Ethereum is the 2nd most popular cryptocurrency in the market. In 2014, the cryptocurrency developers launched a pre-sale of Ethereum that received a good response, which helped Ethereum enter the market with an initial coin offering. As per Ethereum miners, the cryptocurrency can be used to decentralize, codify, secure, and trade just anything.  

After the Decentralised Autonomous Organisation attack, Ethereum developers split Ethereum into two- Ethereum (ETH) and Ethereum Classic (ETC). As per the latest data (Jan 2021), ETH has a market cap of 138.3 billion, and its per token value stands at $1,218.59.

If you are planning to buy ETH , here are a few reasons why investing in Ethereum might be a good option. 

Is Ethereum a Good Investment Option?

The answer to this question is not simple. It would help if you considered several factors when investing in ETH. Here are some points that show why investing in ETH could be beneficial. 

2020 was a good year for Ethereum, and the growth was fueled by the growing sentiment for decentralized finance trends. Generally, Ethereum is swapped for other tokens of Altcoin, which are in great demand. The exchange rate of Ethereum remained high due to the greater demand for Altcoin. 

According to crypto experts, a large volume of Ethereum is locked in decentralized finance applications, and their value has reached billions of dollars. Hence the demand for Ethereum is expected to remain high in the coming years. Ethereum 2.0 is expected to arrive soon, and people with a large amount of Ethereum supply would be able to earn more tokens. It is one of the reasons to buy ETH and gain benefits from the arrival of Ethereum 2.0.

Fundamental Analysis of ETH

The demand for decentralized finance is growing, which has helped the growth of Ethereum, which is based on similar fundamentals. If you look at the performance of ETH, you can see all metrics have shown growth in recent years. Here are some useful metrics that show the growth of ETH

  • Active addresses – 470, 9998 
  • Daily transaction volume – exceeding 2.5 billion dollars
  • Transactions in 24 hour period – more than 1 million

Besides, developers are also actively working on the Ethereum project for improvements. New projects based on Ethereum are launched worldwide, which makes ETH an attractive investment option. 

Technical Analysis 

Bitcoin was the first cryptocurrency that took the world by storm. Ethereum was also developed similarly, and it has followed Bitcoin’s footsteps to gain a fair market share in the crypto market. If you look at the ETH USD price charts, you can see the price rise and decline mimic the bull market patterns. The Average Directional Index shows an upward trend.

Sentiment Analysis

Since the initial coin offering in 2017, Ethereum has grown strong, and the prices have reached $1400 per token. The Decentralised Finance trend is becoming sustainable and healthier that has made cryptocurrencies like Ethereum attractive to investors. The sentiment, social volume, and engagement of investors with cryptocurrencies grew significantly in 2020, and Ethereum has been one of the profitable strategies for many of them. 

Ethereum Price Predictions

If you are planning to invest in Ethereum, you would be interested to know the price trends for it. According to experts, the current price of Ethereum is around $1,735.24 per Ether. Looking at the market conditions, experts believe Ether will touch $9000 someday shortly. These expectations are based on Ethereum reaching a $1 trillion market due to the Decentralised Finance trend. If you consider the Ethereum current supply, one Ether will fetch a price of $9000 when Ethereum reaches a market cap of $1 trillion. 

What Is the Best Policy to Invest in Ethereum?

Now that you know the bright future of Ethereum, many would want to know how to maximize benefits when investing in Ether. According to experts, you need to follow a buy and hold strategy. The cryptocurrency market is highly volatile, and prices could drop significantly at any time in the year. However, as the market recovers, you can see the prices rise as new changes are brought in.

To sum up, the broad adoption of blockchain technologies has made cryptocurrencies a profitable investment option. The higher liquidity offered by cryptocurrencies and the ability to sell and buy ETH on various trading platforms makes Ethereum a good investment option for investors looking for new investment avenues.