Ethereum ( CRYPTO: ETH) has been making waves in the crypto world, rivaling Bitcoin (CRYPTO: BTC) as one of the most popular cryptocurrencies. It’s also experienced explosive growth, with its price increasing by more than 1,000% over the past 12 months.
While crypto prices have plummeted over the past few weeks, that doesn’t necessarily mean it’s a bad time to buy. In fact, downturns can provide a great opportunity to invest when prices are lower. Considering Ethereum is one of the higher-priced cryptocurrencies, right now may be a good time to buy when it’s “on sale.”
Just because the cryptocurrency is more affordable doesn’t necessarily mean it’s a good investment, however. Ethereum is still a high-risk cryptocurrency, and it’s not the right choice for everyone. If you’re on the fence about investing, there are two reasons to consider buying now — and one reason to avoid it.
1. Ethereum 2.0 could give it a competitive advantage
One of the criticisms of cryptocurrency, in general, is that it’s incredibly energy-intensive. Crypto tokens are “mined” through a series of complicated computer processes. That mining process requires a significant amount of energy, and crypto critics have raised concerns over its impact on the environment.
In fact, Tesla CEO Elon Musk recently announced that the company will no longer accept Bitcoin as a form of payment because of its environmental impact. That announcement was one of the reasons behind the most recent crypto crash as investors questioned whether cryptocurrency could really thrive over the long term.
Ethereum, however, is making moves to make the technology more energy efficient. Technically speaking, Ethereum is the name of the blockchain technology, while Ether is the token hosted on that blockchain. Ethereum 2.0 is an updated version of the blockchain that’s set to roll out later this year or early next year, and it claims to use 99.95% less energy than the current technology.
When Ethereum becomes more energy-efficient, it could acquire a competitive advantage in the crypto industry and a leg up over Bitcoin.
2. The Ethereum blockchain has more utility
For any cryptocurrency to survive, it needs to have some type of real-world utility. Right now, Bitcoin is the most popular and most widely accepted cryptocurrency. However, the Ethereum blockchain is used for a variety of purposes, which gives it an advantage.
Ethereum is not only host to the Ether token, but it’s also the foundation for other applications like non-fungible tokens (NFTs) and decentralized finance. NFTs could change the way digital items are bought and sold, and the decentralized finance movement aims to revolutionize the banking industry.
Also, Ethereum 2.0 plans to make the blockchain faster and more scalable so it can be used for even more applications. That could give Ethereum even greater utility and more of an advantage.
Ethereum’s widespread utility could benefit Ether as well. If Ether is required for applications on the Ethereum blockchain, Ethereum’s success could give Ether a competitive advantage over Bitcoin and other cryptocurrencies.
Source : Internet.