After a tremendous 2020, Ether (ETH) set a new all-time high in 2021. Thanks to the popularity of decentralized finance (DeFi) and non fungible tokens (NFTs), ETH is the 2nd most popular cryptocurrency in the world.
The hype of the NFT market has also influenced the price growth — as most NFTs are Ethereum-based, users need Ether to purchase them.
Ethereum's developers are currently working on an upgrade known as Ethereum 2.0. According to a report by Bloomberg Intelligence, Ethereum’s upcoming upgrade will move the Ethereum network from a Proof-of-Work (PoW) consensus algorithm to a Proof-of-Stake (PoS) consensus algorithm. The merge to PoS will reduce network energy usage by at least 99.95% and allow for a more equal distribution of network rewards- improving the long-term scalability and sustainability of Ethereum.
The future of the network looks encouraging, as the possible applications of the network seem to have no end. But, has Ethereum reached a price valley? And in the case it continues to increase, how high can Ethereum go?
What is Ethereum (ETH)?
Ethereum is a decentralized platform capable of moving and storing value. Users can build applications that run on the Ethereum blockchain, the same way a certain software runs on a computer or in a smartphone.
What makes Ethereum different from Bitcoin, is that it invented a tool to create autonomous applications: smart contracts. An infinite number of clauses can be programmed into smart contract code. Smart contracts themselves can check if any of these clauses are met and execute determined actions.
Alongside the Ethereum platform, comes its own cryptocurrency, Ether (ETH). Ether is used as payment in every transaction on the blockchain. It’s the lifeblood of Ethereum, every transaction within the Ethereum network fuels mining for the platform.
Ethereum (ETH) Market Capitalization
Ether stands in the 2nd position in the list of the largest cryptocurrencies by market capitalization, just beneath Bitcoin, which holds the 1st position, with a dominance of 41%.
Ethereum’s market capitalization stands at $360 billion with over 120 million coins circulating the market. By contrast, payment processing companies like Visa or Mastercard possess a market cap of over $450 billion and $340 billion respectively.
Bull Case for Ethereum
With decentralized and blockchain software becoming more popular, cheaper and even more secure than centralized solutions, Ethereum promises to continue growing and developing its environment.
Furthermore, the recent updates to the Ethereum blockchain such as the London Hard Fork make for an attractive opportunity to capitalize on future implementations of the network. The release of the much anticipated Ethereum 2.0 upgrade is expected to occur in the short term, drastically increasing Ethereum's transactions per second and reducing transaction costs.
Along with the update, the blockchain will transition from proof-of-work to a proof-of-stake mechanism for verifying transactions. Not only this will be extremely beneficial for the network but also favors a more environmentally friendly mining system.
While we cannot be certain as to when this update will occur, the increasing amount of Ether tokens staked makes a favorable case for it.
Bear Case for Ethereum
Other platforms that use smart contracts, such as Avalanche or Solana, may represent a threat to Ethereum. These platforms are developing similar networks of decentralized environments, and one could argue that these may eventually surpass Ethereum.
In addition, the increasing levels of regulation could affect the price of Ethereum. In recent events, US and European policymakers have demonstrated their interest to closely monitor online exchanges and determine if certain practices within them could violate the law.
Where to Buy Ethereum
How Long Will It Take for Ethereum to Reach $5,000?
In May of this year, Ethereum reached its all-time high, as the cryptocurrency market grew in value. After a short period of time, the prices dropped down to create a temporary bear market.
With the Ethereum 2.0 already at the development stage, one could expect that the $5,000 price per token would be met with the new release. This upcoming new software will draw the attention of new users, increasing the number of transactions on the platform, thus increasing the value of ETH. But the possibilities of this upgrade appearing in the near future aren’t too high.
Ethereum has previously proven its capacity to reach high price barriers like the $4,800 in November 2021, and demonstrated to be a currency that moves along the rest of the cryptocurrency market. As crypto seems to be entering another bull run, Ethereum might hit a new all-time highs soon.
Where to Store Ethereum Safely
Best hardware wallet: Ledger
Ledger is one of the best services to secure your cryptocurrencies. It provides an offline storage device that stores the user’s private keys in a secure hardware, fully isolating them.
Best software wallet: ZenGo
ZenGo offers a non-custodial crypto mobile wallet to store private keys. Not only does it offer a free crypto wallet, but also allows users to conveniently buy crypto through the app.
Current Crypto Prices
The market capitalization of cryptocurrency sits just below $2 trillion. After having experienced a bullish run earlier this year, the markets started to take a downturn.
Main tokens are regaining investors because of the low prices, attracting those of them wanting to accumulate crypto. Altcoins have been experiencing significant raises on their prices and continue to push over the market.
So, Is Ethereum a Good Investment?
If you expect that the future of smart contracts blockchains is bright, then Ethereum might be an outstanding investment. With the tendency of growth of the past few months, and with the development being done on upgrading the network, the potential of the token seems boundless. New technologies and innovative applications of the software will continue to appear in the upcoming months, creating even more use cases for Ethereum.
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