Is Ethereum (ETH) Good Investment in 2024?
Ethereum is one of the most well-known blockchains in the cryptocurrency industry. And it’s best known for its native token, ETH. The Ether token enables users to make transactions, earn interest on their holdings through staking, and more.
The blockchain-based platform provides the foundation for other networks, which means that many other cryptocurrencies were built off the Ethereum platform.
As the first blockchain to feature smart contract functionality, Ethereum enables the creation of smart contracts and decentralized applications. This means Ethereum has many use cases, making its token valuable to investors.
So, is it a good investment in 2023? How high can the price of Ethereum go in the near future?
Let’s find out.
Start Investing in ETH Right Now With ByBit!What is Ethereum (ETH)?
Ethereum is the second biggest cryptocurrency—behind Bitcoin—by market capitalization. Ethereum’s blockchain can store smart contracts, which are tiny pieces of self-executing code that powers things like decentralized finance (DeFi) applications.
Like with many other cryptocurrencies, you can use Ethereum to send and receive value globally and without a third party stepping in, such as a bank. This decentralization means the currency is nearly autonomous.
This also allows users to make transactions nearly anonymously. That’s even if the transaction is publicly available on the blockchain. The aim of Ethereum is to decentralize data so that thousands of people around the world are handed a copy.
Currently, Ethereum operates with a proof-of-work model to mine new coins. This model allows the network to remain robust by making the process of mining, or recording transactions difficult. This is done by requiring users to verify the accuracy of new transactions that are added to the blockchain.
However, later in 2023, Ethereum plans to move to a proof-of-stake consensus mechanism. This change will reconfigure how the Ethereum system works.
In this model, miners don’t validate transactions. Instead, validators “stake” their currency and earn rewards in the form of Ether to verify transactions. Moving to a proof-of-stake model will lead to fewer Ether coins in circulation and a deflationary spiral. This, in turn, can lead to an increase in price.
Top 7 Reasons To Buy Ethereum in 2024
If you’re wondering whether you should invest in Ethereum, consider these reasons why you can make good profits from investing in crypto.
Ethereum 2.0
Ethereum 2.0 is an upcoming set of upgrades that aim to speed up transactions, reduce gas fees, boost productivity, and increase scalability.
The goal is to accelerate Ethereum’s usage and adoption by improving its performance. It also aims to address the weaknesses of the proof-of-work model by moving to proof-of-stake.
The current Ethereum network can only support 30 transactions per second, while Ethereum 2.0 promises up to 100,000 transactions per second. The new Ethereum network will also be more decentralized and secure. Because the new Ethereum will be more scalable, more people will use it, which can raise the price of ETH to new heights.
The price has corrected significantly
The price of Ethereum has corrected significantly over the past few years. Of late, Ethereum has experienced positive price movement, which shows its potential to be a great long-term investment.
For example, in January 2023, the price of the token soared to new heights at 4,800 U.S. dollars. The price saw such dramatic movement because an ETH investor purchased a digital art piece for over 38,000 ETH – or 69.3 million U.S. dollars.
It also saw a huge jump in price because of the so-called “Berlin update”, which rolled out on April 21, with the aim to reduce ETH gas fees. And the release of the new smart contract protocol known as Uniswap V3 in January 2023 also played a part in the rise of ETH.
Development of the NFT market and metaverses
The rise in popularity of NFTs and the Metaverse has played a role in increasing the value of many cryptocurrencies, including Ethereum. That’s because users can purchase NFTs with cryptocurrencies on different blockchains. This capability adds yet another use case for the ETH token, which drives up its value.
For example, Ethereum based metaverse Decentraland had the second-largest cumulative NFT sales volume at $216,471,162. Therefore, the Ethereum blockchain is a popular place to purchase NFTs and experience the metaverse.
Innovation and development
Ethereum is a host for innovation as fascinating new projects are being built on Ethereum, from microgrids to charging stations for electric vehicles.
Portfolio diversification
You might also consider investing in Ethereum to diversify your current crypto portfolio. That’s because Ethereum’s technology and purpose are different from other cryptocurrencies like Bitcoin. It’s clear that Bitcoin is a good investment.
But you can further improve your portfolio by investing in Ethereum. Why? Because it’s intended to be a platform for smart contracts. With Ethereum, you can not only store, value, and purchase things, but you can also program smart contracts and tokenize assets.
Strong long-term potential
If you’re an investor who doesn’t mind “playing the long game”, then Ethereum can be a great investment for you. Once it fully moves to proof-of-stake, Ethereum may eventually dominate DeFi.
If Ethereum can rise to the top of DeFi on a proof-of-work model that’s more costly and less scalable, then it would definitely seem highly likely that it will capture even more market share once the move to proof-of-stake is complete.
And even though the price of ETH has fallen 75% ($1,500) since it's all-time high of $4,800, it could rise back to its all-time high once the crypto economy gets back to normal. This means that if you took position today, you could see a 200% return on your investment.
Uncensorable apps
Censorship is often an issue in today’s digital environment. Various social media platforms have the right to delete, modify, or hide content.
Because Ethereum is decentralized and isn’t limited by a regulatory body, the information stored on the blockchain can remain alive and uncensorable. So, keeping people more informed and giving them the ability to make more educated decisions is yet another use case Ethereum has to offer. This can drive up its value and price.
Top 3 Reasons Not to Buy Ethereum (ETH)
H3 Ethereum killers
Ethereum is known for its high transaction fees, scalability issues, and lack of sustainability.
“Ethereum killers” are now emerging to address the weaknesses of the Ethereum blockchain. Cryptocurrencies like Cardano, EOS, Solana, BNB, and Polkadot are gaining in popularity in the market.
The inherent proof-of-work mechanism allows a limited number of transactions per second. This slow transaction speed, in turn, increases gas fees on the platform, which are important for powering the network. The “Ethereum Killers” aim to address this by operating on a proof-of-stake consensus mechanism.
The “Ethereum Killers” also aim to address Ethereum’s lack of sustainability, which is caused by high energy consumption. Many of them are looking to achieve carbon neutrality, which can in turn, counter height transaction fee challenges.
Ethereum security threats
The Ethereum blockchain has faced a few security vulnerabilities for the execution of smart contracts. For example, in 2016, Ehtereum developers launched the DAO, a digital decentralized autonomous organization.
Soon after the launch, users exploited a weakness in the DAO code, causing the DAO to lose $70 million in ETH. Since then, Ethereum has improved the security of its smart contract code.
However, because cryptocurrencies are digital, they can be prone to hacks. So, it’s important to invest in ETH— or any other cryptocurrency—at your own risk.
Extreme volatility
Like many other cryptocurrencies, ETH is an extremely volatile instrument. This means that the price of ETH could rise and fall sharply in a short period of time. 2021 displayed a perfect example of ETH’s volatility and high sensitivity to market conditions.
Between May 12 and May 24, ETH lost nearly 50% of its value. While it has somewhat recovered since then, it can be a risky investment and cause many investors to lose confidence in Ethereum.
While Ethereum shows great promise as an investment, there’s no guarantee that it will succeed long-term.
Therefore, if an investor doesn’t have a high tolerance for risk and can’t afford to lose, it’s best to avoid it. This is why it’s so important to do your research and know what you’re getting into before you invest in ETH.
Top 5 Tips for Buying Ethereum
If you decide to invest in Ethereum, it’s best to do so with great caution in order to minimize risks. Below are 5 tips for purchasing ETH.
Accumulates position gradually at different price levels.
This is important because it will allow you to hedge your risk when there are significant price changes.
Use technical analysis to identify key levels on the chart to increase positions and wait for them.
This involves using mathematical indicators based on previous price action data. Doing so could help you predict future trends in price.
Don’t invest more than you can afford to risk and don’t use credit funds.
When it comes to investing in cryptocurrency, it’s always smart to think carefully about your decisions.
This involves being conservative when investing your money and going into the process knowing your risks. This is because of the high volatility of Ethereum. If the price significantly drops, you could end up losing a lot of your investment.
Use staking as a smart long-term investment.
Staking Ethereum is one of the smartest ways to increase your earning potential from your investment.
You can earn passive income by contributing to the security and viability of the network in the form of annual interest. That way, if you’re not getting much of a profit from investing in the token itself, you can “lock” up a portion of your ETH for a period of time. The more ETH you stake, the higher your potential reward.
Make Ethereum part of a wider investment portfolio of cryptocurrencies, stocks, and other assets.
In other words, don’t put all your eggs in one basket. So, in order to hedge against potential risk, it’s important to diversify your portfolio. If you put more money into one asset like ETH, you’ll be greatly increasing your risk.
Where to Buy ETH
There are many ways to purchase Ether. You can buy ETH through cryptocurrency exchanges (centralized), decentralized exchanges, or some wallets.
ETH is available on a wide range of crypto exchanges like Bybit and Kraken.
Bybit
Headquartered in Singapore, Bybit is a cryptocurrency derivatives exchange that offers multiple trading products and options.
The exchange offers a wide range of ETH trading pairs on both the spot and derivatives markets. Bybit offers high trading leverage to help investors maximize their profits. You can also stake ETH on Bybit and earn a guaranteed APY.
Kraken - Best in the US
Kraken is a U.S.-based cryptocurrency exchange that’s one of the more established on the market. The platform offers an easy, safe way to buy and sell a range of cryptocurrencies, including Ehtereum.
A unique feature that sets Kraken apart from other crypto exchanges is that it allows clients to use the ETH Dark Pool Trading. With this feature, you can discreetly place large trading orders without exposing the order book to the public.
How High Can Ethereum Go in 2024, 2025, 2030
So, how high can Ethereum go in the near future? We’ve compiled Ethereum long term price predictions. While they can be useful, it’s worth remembering that the predictions are often inaccurate.
Ethereum Price Prediction 2024, 2025, 2030Should I Invest in Ethereum (ETH) Right Now? Conclusion
With all things considered, Ethereum is a relatively good investment. The blockchain has many use cases and provides the foundation for several different technologies. If the token is doing well now even with high transaction fees, scalability issues, and lack of sustainability, it may perform even better when it moves to ETH 2.0.
Given these facts, it’s safe to say that you could see extraordinary gains from investing in ETH. However, because of its volatility, potential competition (“Ethereum Killers”), and potential security issues, it’s best to proceed with caution and invest as much as you’re willing to risk.
FAQs
Is Ethereum a good investment?
Ethereum, like many other cryptocurrencies, is extremely volatile and highly sensitive to changes in supply and demand. For this reason, crypto assets like Ethereum carry a high risk, but also have great potential for high profits. If you’re looking to invest in Ethereum, be sure to diversify your cryptocurrency portfolio to reduce risk.
How much will Ethereum cost in 2030?
According to many predictions, Ethereum has the potential to be a solid investment in the long-term. It’s predicted that the price of ETH could reach a maximum of $18,534.
Is Ethereum a good investment 2024?
Ethereum is the second most popular cryptocurrency by market cap, which means it has great potential to rise in price over the next few years. Therefore, you could make significant gains by investing in ETH right now.
What will Ethereum 2.0 be worth?
Some experts predict that ETH will hit $12,962.33 in 2024 once it makes the switch to Ethereum 2.0.
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Team that worked on the article
Oleg Tkachenko is an economic analyst and risk manager having more than 14 years of experience in working with systemically important banks, investment companies, and analytical platforms. He has been a Traders Union analyst since 2018. His primary specialties are analysis and prediction of price tendencies in the Forex, stock, commodity, and cryptocurrency markets, as well as the development of trading strategies and individual risk management systems. He also analyzes nonstandard investing markets and studies trading psychology.
Dr. BJ Johnson is a PhD in English Language and an editor with over 15 years of experience. He earned his degree in English Language in the U.S and the UK. In 2020, Dr. Johnson joined the Traders Union team. Since then, he has created over 100 exclusive articles and edited over 300 articles of other authors.
The topics he covers include trading signals, cryptocurrencies, Forex brokers, stock brokers, expert advisors, binary options. He has also worked on the ratings of brokers and many other materials.
Dr. BJ Johnson’s motto: It always seems impossible until it’s done. You can do it.