Should I invest in Ethereum?

If you’re thinking about investing in Ethereum, you’ll want to be sure you’re doing the right thing; after all, there are so many different cryptos out there it can be hard to pick out the best ones.

You can keep a regular check on the outlook for cryptocurrency prices at InfoChoice.

What is Ethereum?

The story behind Ethereum (so far):

Ethereum was first proposed as a development of Bitcoin, but BTC developers nixed the idea so programmer Vitalik Buterin went it alone with his own team instead.

The idea was to give programmers a way to develop their own applications to use on the blockchain and it’s this facility that makes it popular with investors and the crypto industry in general as it can seed new projects.

ETH was launched in August 2014 and the team has made quite a few changes and improvements to the token since that date.

Ethereum has been a rising ‘investment’ – so far

Over the last 12 months the price of ETH has almost doubled to AUD$366, from around $170.

Buying ETH has worked out pretty well for lots of Australians so far. In January 2017, one ETH was worth around $14, whereas in January 2020 one ETH was worth $230, and now $366.

The currency had a huge spike in the middle of 2018, reaching a high of $1,752, before falling to around $115 by the end of that year.

Ethereum and Ethereum Classic

You might wonder what the difference is here. Classic is the original ETH, but after a huge hack, the Ethereum community decided to make a fork – a change in the protocol – so that the thieves couldn’t use their ill–gotten gains. Ethereum is actually the forked–off currency.

Is ETH a good investment?

The crypto industry is still very young, so as it expands and develops, ETH should grow alongside it.

Ethereum is one of only a few cryptos used by initial coin offerings (ICOs), so it can act as a launch pad for new tokens and this makes ETH very useful to the community and industry.

As more people catch onto crypto and start using it, ETH could grow quite a bit, especially as it’s also one of the most popular currencies for payments and purchases.

Blockchain and its associated cryptos are helping to drive forward open financial systems by making them more secure, streamlined and accessible to everyone, not just banks.

What is an open financial system?

An open financial system, or open banking, is when banks and their customers agree to share their data with a third–party service provider and this provider can speed up transactions, help to advise consumers and make the system much more secure.

The downside (negatives) of Ethereum

There may well be better cryptos to invest in, so always be on the lookout.

Long–term investing means that while you might see gains over time, you don’t get the same opportunities to buy low and sell high that a volatile market could offer you.

Another coin could come along at any moment to disrupt the industry, or at least knock ETH and BTC off their pedestals.

The government could bring in new regulations which could affect the price of ETH, so keep your eyes on crypto news and be ready to move if this looks likely.

Making short term investments in ETH

The short term outlook for Ethereum seems positive but short–term investing means that you’re buying and selling in synch with the falls and rises of Ethereum.

As cryptos are prone to volatility, you’ll get more chances to buy low and sell high, but this takes a lot of watching so that you’re ready to make the moves. You need to keep up with the outlook and research and spend time tracking the market.

The 2020 Outlook for Ethereum

Lots of ICOs are planning to release their tokens on the ETH network in 2020, so this could see the currency rise. At the moment, ETH is at a fraction of its 2018 record high.

Looking at Ethereum vs Bitcoin, BTC’s finite supply of coins may push it higher in 2020 while both BTC and ETH are set to gain a lot of market traction as more people and institutions adopt cryptocurrency tech and systems.

Get the latest updates on crypto prices and the outlook for cryptocurrencies at InfoChoice.

This article is news and information, not financial advice. The products compared in this article are chosen from a range of offers available to us and are not representative of all the products available in the market and influenced by a range of factors including interest rates, product costs and commercial and sponsorship arrangements

InfoChoice compares financial products from 145 banks, credit unions and other financial institutions in Australia. InfoChoice does not compare every product in the market. Some institutions may have a commercial partnership with InfoChoice. Rates are provided by partners and taken from financial institutions websites. We believe all information to be accurate on the date published. InfoChoice strives to update and keep information as accurate as possible.

The information contained on this web site is general in nature and does not take into account your personal situation. Do not interpret the listing order as an endorsement or recommendation from us.  You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser. If you or someone you know is in financial stress, contact the National Debt Helpline on 1800 007 007.

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