Things to Know Before Investing in Ethereum in 2018

| Publish date: 02/09/2018 (Last updated: July 30, 2018 03:59 AM)

With all the hype around cryptocurrencies these days, it makes sense to invest in what seems to be a guaranteed steady return in the crypto market.

There are many other options aside from Bitcoin that, despite functioning solely as a digital currency, seems to attract most of the attention.

If you’re looking for an alternative cryptocurrency with versatility in its application, then Ethereum is a solid choice. Its utility as an open source platform for many businesses combined with an approachable market price provides much in terms of future stakes for Ethereum.

Important Facts about Ethereum

1. Ethereum played a significant role in the meteoric rise of the initial coin offerings market which is expected to break through the $5 billion barrier in 2018.

2. During the last 2 years, Ethereum became the platform of choice for blockchain-based currencies.

3. Ethereum has the biggest community of developers building on the Ethereum platform.

4. Ethereum could potentially move from PoW to PoS in 2018, which would help solve many of Ethereum’s scalability issues.

5. Ethereum has had some serious scaling problems in the past, especially as seen with cryptokitties, a virtual “pet ownership” game that significantly slowed down the Ethereum network.

6. Fees to utilize the Ethereum platform continue to grow, and this is leading many potential ICOs to look for other platforms.

Ethereum is Different than Bitcoin.

It is vital to understand what Ethereum is and what it isn’t.

While it may seem straightforward that Ethereum is simply another cryptocurrency and that buying a bunch of it will eventually net a solid profit, it’s best to know exactly what you’re getting with Ethereum. Like any investment, there are risks and pitfalls, and understanding your investment will save you time and money.

Ethereum takes what Bitcoin created and moves it one step further. Bitcoin’s blockchain focused on establishing a service/fund transfer using the open ledger characteristic of blockchain to prove the transfer of funds. Ethereum takes that basic concept of blockchain and created its own blockchain as a foundation for DAPPS or decentralized applications off of it.

Ethereum centers around “smart contracts.” Using Ether, Ethereum’s cryptocurrency, to facilitate transactions as a result of certain, specifically designed actions occurring. Furthermore, it is an open source of blockchain that allows companies to utilize the code for their own programs.

This is what makes Ethereum powerful.

Blockchain will revitalize business. Its decentralized nature makes it appealing to businesses that want to remove third parties that leech off transactions and slow down the process. It allows for nearly instantaneous, global transactions. Businesses are gravitating towards blockchain because of its reliability, tamperproof design, transparency. Developing businesses will need to able to access an open source blockchain to build their infrastructure off of it. This is what Ethereum offers.

This is the most important thing to understand about investing in Ethereum: You’re not simply investing in a digital currency, you’re investing in the foundation other companies are utilizing to build new applications. This is what makes Ethereum special. It has a utility value on top of its monetary value. It’s like buying a cheap property versus buying a commercial real estate in a neighborhood before it gentrifies. The commercial real estate has long-term, diverse portfolio potential. Ethereum has that potential.

Know the risks.

With several prominent investors like Warren Buffett and Mark Cuban warning that cryptocurrency is a bubble on the verge of collapse, it’s natural to feel wary about investing in a relatively new product that seems to be on an unnatural climb towards imperceptible returns.

Keep in mind that there are plenty of risks. Whether or not cryptocurrency is a bubble remains unseen. But this is again where Ethereum stands out. Ethereum supports business development with real-world, application value. This utility value gives it strong investment potential.

How Trustworthy is Ethereum?

Ethereum is a less risky investment than other cheaper, newer cryptos on the market because it’s more established with more inherent trust from investors. As a result, it’s is also one of the more expensive cryptos on the market and why it’s projected to continue to climb. But just because it is trusted, doesn’t mean it is fully trustworthy.

Under the terms and conditions of Ethereum, it states: there may not be a continued demand for the platform, there may be possible weaknesses introduced by either the Ethereum Team or third parties, and there are possible future developments in hacking that would make the cryptocurrency vulnerable. We are still in the blockchain’s infancy, and problems may arise.

Blockchain seems unhackable. This comes from the need to alter what is called the “ledger” or the history of transactions that represents what blockchain is and what makes it tamper-resistant. Be wary of anyone saying cryptos are anything “proof.” A product of value is at risk of outside tampering. Because blockchain is new and developing, there exists the possibility that programs may be develop that could theoretically destabilize the blockchain by somehow managing to alter the code, however unlikely that may be.

There are other risks to be aware of as well. Scams are prevalent. Digital wallets have been hacked. Computer security has been compromised by hackers who drain cryptocurrency from investors. Understanding the risks is necessary to protect your investment and make the most on your returns.

Investing in Ethereum

Investing in Ethereum is a relatively straightforward process. The easiest way is to download the CoinBase app on your smartphone, sign up, input your bank data, and purchase the amount of Ethereum you want. Be prepared for your bank to halt the transaction and wait for your approval as that happens sometimes.

Other options involve selecting a different wallet for crypto storage. These can be hardware, digital, or print paper wallets. Here are some great suggestions for Ethereum wallets. Download the one that best suits you. Add a payment method. Click on Buy/Sell and select the amount of Ethereum you wish to purchase. Then click Buy Ethereum. That’s essentially it.

Consulting experts on market prospects is best when you’re ready to invest in Ethereum in order to make the most on your return.

The Long Run.

Finally, take a step back and be proud. You’re one of the growing population of people who understand that blockchain is the future, and you’ve taken the steps towards investing in that future. You’re not alone. The Enterprise Ethereum Alliance connects an increasingly growing group of investors such as yourself who understand that blockchain will change the future and believe that Ethereum will be leading the way.


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