Today, Ethereum is the second-largest crypto on the market. It recently moved from a proof-of-work (PoW) consensus mechanism to a proof-of-stake mechanism (PoS). Many crypto users were expecting massive market rallies at the beginning of 2022, but the effect of the bear market weighed heavily throughout last year.
So will 2023 be different for Ethereum? Should you invest in Ethereum? This article will present the top ten reasons why Ethereum may be worth investing in.
1. NFTs
The NFTs market has witnessed exponential growth in recent years, with NFTs being sold for millions of dollars.
Ethereum has a dominant role in the NFT space. Most NFT marketplaces run on Ethereum. Ethereum’s blockchain is also preferred by many to mint NFTs. In 2021, Polymath, an Ethereum-based NFT platform, raised $59 million in funding. The value of Ethereum will only rise as more assets are tokenized through NFTs.
2. DeFi
DeFi uses smart contracts to decentralize banking services. Decentralized finance has witnessed tremendous growth in recent years. Most Decentralized Finance projects run on the Ethereum blockchain.
Bancor, Compound, and MakerDAO are some of the popular DeFi protocols based on the Ethereum blockchain. These notable DeFi projects keep adding value to Ethereum, making it one of the best cryptos to buy[1] .
3. Tokenization
The Ethereum blockchain enables users to convert any digital assets into tokens. There are many advantages for companies in tokenizing assets. Companies can diversify their offerings, fractionalize assets such as real estate, and have new incentive models.
The World Economic Forum (WEF) has projected that by 2025–2027, up to 10% of the global gross domestic product (GDP) will be stored and transacted using blockchain technology.
4. Improves Global Interconnectivity
The advent of the internet interconnected the world first, but Ethereum is improving the levels of interconnection between companies and individuals.
Smart contracts are the main reason for Ethereum’s popularity. Smart contracts can help users secure ownership of physical items like artwork, real estate, and even cars. Foreign investors can own art in another country without going through the bureaucracy. These investors can buy, pay for, and secure assets using a smart contract built on the Ethereum blockchain.
5. A Platform For Future Innovation
Many new projects are being built using the Ethereum blockchain. Crypto projects on collectibles, healthcare data management, charging stations for electric cars, and microgrids are being built using Ethereum.
Similar to how the internet survived the internet bubble, Ethereum did not die after numerous crypto bear markets. The Ethereum blockchain has only gained strength and evolved through its varied applications.
Read more: What is Crypto[2]
6. Good Choice To Diversify Your Portfolio
When compared to Bitcoin, Ethereum does not have the same brand awareness and immutability. Bitcoin is scarce, as only 21 million coins will be produced, whereas Ethereum is uncapped.
Bitcoin is the first choice for many crypto investors, but Ethereum is also a good option for investors to diversify their portfolios.
The use cases of Ethereum are different from those of Bitcoin. Bitcoin is meant to be crypto mainly used to store value and pay for goods, whereas Ethereum is intended to build applications using Smart contracts.
Ethereum is a solid choice for crypto investors to diversify their portfolios.
7. Bypass Censorship
Today, censorship is a real issue that some of us face. Twitter, Instagram, and other major companies can modify, hide, or even delete content.
As Ethereum is decentralized, it can help users remain informed and connected with the rest of the world. Governments or other agencies cannot modify or delete any information stored on the Ethereum blockchain.
This unique feature makes it attractive to many users and is another reason for you to invest in Ethereum.
8. Volatility
While volatility can be viewed as negative, smart crypto investors have studied the market patterns and can capitalize on the major gains by investing during the dips.
9. Liquidity
Due to global crypto trading platforms and exchanges, Ethereum has become one of the most liquid assets. Users can easily trade ETH for assets like stocks or ETFs.
10. Ethereum has a bright future.
The Ethereum merge took place on September 6 of last year. The merge transitioned from a slow and energy-intensive proof-of-work consensus mechanism to an efficient proof-of-stake mechanism.
This transition is a significant event because the Ethereum platform will become more conducive for future application developments.
Should I Buy Ethereum Now?
The CEO of Ethereum, Vitalik Buterin, is focused on making Ethereum the best Smart contract platform and is passionate about continuously improving Ethereum.
Due to its varied applications, network upgrades, and reduction in energy wastage, Ethereum is one of the best cryptos to invest right now. But at the end, your interest to invest in crypto should also depend on your knowledge in crypto, and risk-reward management.
You can now buy Ethereum to INR[3] through ZebPay. Sign up and start trading now.
Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Each investor must do his/her own research or seek independent advice if necessary before initiating any transactions in crypto products and NFTs. The views, thoughts, and opinions expressed in the article belong solely to the author, and not to ZebPay or the author’s employer or other groups or individuals. ZebPay shall not be held liable for any acts or omissions, or losses incurred by the investors. ZebPay has not received any compensation in cash or kind for the above article and the article is provided “as is”, with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information.