Back in 2013, the creative mind behind Bitcoin Magazine, Vitalik Buterin, built the Ethereum concept to enhance Bitcoin. He launched a groundbreaking development in the field of technology through his creation. Vitalik Buterin was the recipient of a one hundred thousand dollars Peter Thiel scholarship. However, he ditched his university studies to undertake his project.
Currently, it is the second most popular cryptocurrency after Bitcoin. However, the coin has surpassed Bitcoin in a few areas such as growth rate, capitalization growth, etc. Is Ethereum worth investing in? Let’s find out first how to invest in Ethereum.
Know how to invest in Ethereum
Ethereum is an open-source platform based on blockchain that allows programmers and developers globally to create decentralized applications (DApps) from a sphere of life. Whether you are running a hotel business or a financial services business, and you have an idea of a fantastic app. This could revamp the industry you are working in, you can develop a similar application utilizing Ethereum’s engine power.
Ether distinguishes itself from Bitcoin in a coordinated way. Ethereum’s capacity is facilitated by smart contract functionality. This functionality has become a vital component in its growing popularity. For the common fund transfers, you can use BTC or any other digital asset. However, it decodes user relationships on an essentially different plane like how to invest in Ethereum.
A smart contract is an intricate software algorithm developed to enhance commercial contracts on the blockchain. This is what has turned out to be a vital factor in Ethereum’s increasing popularity. All the other cryptocurrencies use only one type of address, a personal account. On the other hand, in Ethereum, the address of the contract is added to it. You can note down the terms of the transactions on the contract. In other words, it means you don’t need the services of a lawyer or an attorney. The platform itself can guarantee the fulfillment of the agreed terms.
As a distributed, open and virtual platform, the blockchain launches any decentralized programs. The infrastructure is essentially an ecosystem that disseminates information around the world. The information cannot be manipulated, is not subject to change, and cannot be erased or removed. This technology has been adopted by many countries and applied in different areas such as medicine, logistics, and financing. The following functions have been availed, thanks to contracts technology:
- Creation of complex smart contacts for supply management;
- Launching decentralized applications of various categories (service, games, etc.);
- Mutation of a token into any asset (precious metals and stones inclusive);
- Development of user identification solutions;
- Confirmation the authenticity of documents
Is Ethereum a good investment in 2020?
To be able to answer this question for today, let’s look at ETH’s price performance from 2015-2020. then perhaps, you can decide how to invest in Ethereum today.
The pioneering version of the cryptocurrency protocol dubbed frontier was rolled out on July 30, 2015. Back then, Ethereum did not exist. The first existing records of ETH’s value date back to August 7, 2015. ETH was listed on Kraken crypto exchange on this day, for $2.77 each coin. Within three days, the value of ETH dropped four times to hit $0.68, most likely due to the impact of rapid sales organized by the early investors.
The first substantial event on the network dates on August 18, after the first 100,000 blocks. At this juncture, the rate drops to $1. Two months later, an automated reduction in the price of Ether takes place. During the period, more and more cryptocurrency enthusiasts understand Ethereum. The Devcon-1 developer conference made a particularly crucial contribution to the outreach.
On January 11, 2016, the price of Ether eventually broke the $1 mark again and rallied upwards to never return there again. In two months, the value of ETH rises substantially against the background info about the previous substitution of the network’s protocol. A more steady version (Homestead), reached its first crucial high of $15 on March 14. For the first time, the market cap of ETH reaches past $1 billion.
Ethereum upgrade hard fork took place on March 14, and during this period, the price of Ethereum began a sharp correction. After the hard fork, the price of gas was reduced by half to $7.3. Hackers stole $50 million from the Ethereum project on June 16, 2016, which results in a market panic that drops the price of Ether to $11.
A controversial hard fork followed on July 20, 2016, after which Ethereum classic was born, followed by the supporters of a free censorship and blockchain interference. Two days after the hard fork, the price of Ethereum on the global exchange which had recovered back to $15 dropped again to hit $8 by August. However, in mid-September Ledger Nano S hardware wallet added support for Ethereum, boosting its value back to $15.
On September 22, a DDoS attack was discovered on the Ethereum blockchain which slowed down its work significantly. The news of the attack initiates a local downwards rally that lasts for two and a half months up to December 5, at the price of about $6. By the end of the year 2016, the price of Ether is consolidating in between $7-$9.
Ethereum commenced the year trading at $8 on any exchange it was available.` Throughout January and February, the price of ETH steadily rises to reach $13. At this point, a more swift upwards rally begins with the price of ETH hitting $53–59 during the last two weeks of March. On April 24, a new price boost begins, and within ten days the price almost doubles to reach $95.
AVATRADE trading exchange adds Ethereum on May 18. In June, the price of ETH reached $400. However, news of Chinese crypto trading and ICO ban results in the general market reduction, and the price drops to $200. The price of Ether consolidates between $275-350 until mid-November, before breaking past the $400 resistance on November 23. Ethereum enters the final growth phase of 2017 on December 11, when its value hits $800.
ETH’s rates rose on the very first day of 2018. The coin attained its absolute maximum since inception on January 13 after hitting $1,400. Meanwhile, on 5th February Ethereum rebounded from its all-time high to $700. Since then, until around sometime in early April, the coin encountered a gradual decline to the $380.The decline slowed down in September after hitting somewhere between $180 – $190. By November, ETH consolidated between $200 – $300. To some point, it even hit as low as $85 but was followed by a surge of $130 – $140, after which the year came to a close.
Ethereum’s first days into 2019 saw it reclaim the second position on CoinMarketCap. The coin hit $160 and its local maximums within this period were $160 and $180. In the second month, it was time for the Constantinople hard fork. Unfortunately, Ethereum’s price did not respond to the event, however. By early May, the coin began rising following Bitcoin’s upward momentum, and within five days attained $280. That summer and autumn, Ethereum was the second-largest altcoin on CoinmarketCap and was trading between $170 and $220.
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2020 hasn’t been a good year for both the financial and economic worlds. Currency heavyweights from Bitcoin, to the US dollar, have felt the impact of the prevailing situation. Whereas Ethereum had entered and was running into a bull run, the coin started plummeting into the start of 2020. The drop went on for the better part of January and February, claiming the coin from $280 to $106 on 13th March. After this event, Ethereum stabilized and rebounded, only to trade within the range of $125 to $140. April 19th, Ethereum’s price hit $211. A price point at which it almost reclaimed the pre-drop point.
Why Invest in Ethereum?
Let’s look at the value of Ethereum both in price, utility, and application. Note that Vitallik Buterin, Ethereum’s co-founder never conceived Ethereum as a cryptocurrency as first but as blockchain technology for decentralized applications, Decentralized autonomous Organizations, ICO investment, and fiat asset – altcoin bridging the gap. Ethereum’s utility transverses the following.
- Investing ICO – Most investors preferred Ethereum over other cryptocurrencies because of its average cost. This is compared to the high market price of Bitcoin
- Placement of dApps – The Ethereum ecosystem boasts a huge number of decentralized applications and the figure continues to rise. The ecosystem has given rise to the decentralized exchange model. Such a cryptocurrency exchange operates using the decentralized model and allows crypto exchange via peer to peer networks.
- DAO – The Ethereum network sets the foundation and pace for decentralized autonomous organizations, one such example is Dash.
- Mining – Ethereum replete the crypto-verse with a mining option, besides that of bitcoin, which is considered expensive and intensive.
- Payment Platforms – Some platforms also provide an option buy with Ethereum. Hence making the coin a choice for online merchants and crypto ATMs. The merchants then exchange the coin on an exchange platform for fiat.
A crypto research firm estimated that the 7 leading crypto assets are founded on the Ethereum ecosystem. This shows how significant Ethereum was as the genesis of the altcoin boom. Several big investor corporations have come out to claim that this is not only profitable for Ethereum but also, a means of investing in projects relating to the altcoin. Nonetheless, note that the Ethereum platform is a network for creating decentralized applications, and Ethereum (ether)is only but a token resulting from the Ethereum blockchain. This ascertains that Ethereum not only has utility but is also a mind-blowing investment tool.
How do you make money with Ethereum?
There are several ways you can invest and earn money from the cryptocurrency. These ways could be short, medium, or long term. For instance, through banking, staking, Ethereum Invest Trusts, derivatives, or buying and selling Ether directly through a trading platform. Read on to figure out how to invest in Ethereum.
Buy and Sell Ethereum
Try peer to peer (P2P) exchanges such as LocalCrypto (was initially called LocalEthereum and enabled people to buy Ethereum) allow users to buy and sell cryptocurrencies. Employees who are paid through crypto can exchange their coins via the platform for fiat currency, regardless of their location. However, traders can take advantage of the exchange and act as peer exchanges, through buying and selling of Ethereum.
One can easily initiate and execute a high price Ethereum sell at a profit. Hence, buying and selling is at least one of the best ways of how to invest in Ethereum. As well as a means to exchange crypto on any crypto exchange platform. As a start, you can buy Ethereum with USD, using a credit card. A cryptocurrency exchange such as Binance offers this functionality to those investing in Ethereum
Trading Ethereum with CFDs
In case you are not comfortable buying Ethereum (ETH) directly, another option is to approach cryptocurrency brokers / or an exchange providing derivative options. These cryptocurrency brokers should have traders with CFDs. One benefit you will find here includes high profits if you can predict market trends of the coin correctly. Additionally, this one doesn’t require you to have an Ethereum wallet and could be a long term trading option for those investing in Ethereum.
Ethereum Stock Trading has become a means for traditional investors to invest in digital currency. More and more people are gaining access to crypto markets. Some of the were initially vested in traditional equities, fiat currency, and assets. We advise those looking both medium and long term investing in Ethereum to consider stock trading as an alternative investment option.
Nonetheless, note that a stock trading platform is a high-risk investment tool and you should take great care not to make any mistakes. Are you interested in stock trading for Ethereum? This how-to buy guide will help you navigate this form of trading; as well as give you an easy means of knowing how yo invest in Ethereum (Eth)
The role of cryptocurrency miners has become an essential part of blockchains. Miners contribute to the creation of new blocks. These blocks are only possible because a miner has committed, confirmed, and verified a prior block. Hence contributing to the creation of yet another and another block. The Ethereum network incentives miners through block rewards. The question remains significant, h
This incentive is in the form of Ethereum and is awarded after every successful block verification. Traders investing in Ethereum can then buy Ethereum from these miners if they opt to sell them; though an exchange platform. The mining process is a bit similar to that of bitcoin, only that it uses the Proof of Work algorithm. a mechanism that was conceived for many cryptocurrencies that came after bitcoin.
Being the second-largest cryptocurrency by market cap and as well the leading altcoin in the crypto-verse, Ethereum is an excellent, safe tool to invest in. In fact, for non-risk-taking individuals, the coin would serve their investment needs a great deal. Nevertheless, the value of the coin will continue to grow as much as the market grows in its demand. So far, there isn’t any need to have doubts about the coin. It has already established itself as a crypto heavyweight. Well, if you’ve done your due diligence, Invest in the altcoin. If you have any questions on how to invest in Ethereum, feel free to ask.