Is Ethereum a Good Investment in 2024?
12 Dec 2023 by Rory Kejzerko 7 min read
Is Ethereum a Good Investment in 2024?

As we prepare for the next crypto bull market, many people are asking themselves ‘is Ethereum a good investment?’. 

As the unequivocal leader of the altcoin space, Ethereum (ETH) is undoubtedly a coin that poses a lot of promise for the future. Most notably, this is through its stature as the most widely-used and interoperable blockchain network in Web3, as through such feats, demand is ever-growing for its native ETH token. 

Be it explicit crypto or NFT purchases that involve ETH, or simply for paying gas fees that are tied to transactions involving other Ethereum-residing crypto tokens, ETH plays host to a worldwide demand stream that shows no signs of dying. 

With these prospects in mind, this article will now uncover the answer to ‘is Ethereum a good investment,’ with both pros and cons of the coin to be discussed. 

What Is Ethereum?

Ethereum and its native ETH token serve as an intelligent computing platform that empowers the execution of ‘smart contracts’.

In demonstrating the power of blockchain technology, these contracts ultimately obviate the need for an intermediary to supervise secure transactions. Moreover, their placement on blockchain technology guarantees the transparency and irreversible nature of these agreements.

Consequently, Ethereum's introduction of smart contract capabilities in the mid 2010’s marked a groundbreaking era in computer programming, digital ownership, and numerous other advancements that revolve around the world of decentralised living (a.k.a. Web3). 

And whilst collectively these feats are very optimistic - with regards to the question ‘is Ethereum a good investment that is -’ assessing the token's viability as a prudent investment in 2024 requires careful consideration of its potential value. 

Is Ethereum a Good Investment? - Pros

Here are five reasons as to why the Ethereum network is one that hosts an array of bullish opportunities for ETH investors. 

Potential as a Global Computing Platform

Ethereum gained significant recognition in June 2017, wherein it almost surpassed Bitcoin (BTC) due to its proficiency in executing smart contracts. Further, the platform's smart contracts have the capability to securely establish ownership of assets such as homes, artwork, and luxury cars. This feature enables individuals worldwide to navigate foreign bureaucratic systems when acquiring property or art in another country, further enhancing global connectivity.

Tokenization Leadership

With predictions suggesting that up to 10% of the global GDP will be transacted via blockchain technology by 2025–2027, Ethereum, boasting the second-largest market cap of over $270 billion as of December 2023, stands out as a leader in tokenization. 

Further, the network’s unmatched interoperability functionalities position Ethereum intuitively as a frontrunner in governing this new era of data storage and transactions.

Uncensorable Apps

In a world where censorship challenges prevail on major platforms, Ethereum emerges as a potential solution. Its decentralised nature ensures that information stored on its blockchain, including data, smart contracts, and decentralised applications (dApps), remains impervious to shutdowns by governments or agencies. This uncensorable quality contributes significantly to Ethereum's value proposition, especially in preserving an informed and free society.

Innovation Leadership

Despite an 84% price decline following the burst of the 2017 'crypto bubble,' Ethereum exhibited resilience and continued to thrive. 

The platform serves as a fertile ground for innovative projects spanning diverse industries, including microgrids, electric vehicle charging stations, crypto collectibles, home mortgages, and healthcare record systems. This sustained growth underscores Ethereum's adaptability and its role as a foundation for cutting-edge ventures.

Diversification in Your Portfolio

Ethereum differentiates itself from Bitcoin both in technology and purpose. While Bitcoin excels as a solid investment in digital currency, Ethereum offers a unique value proposition by serving as a versatile platform for smart contracts, asset tokenization, and various applications. 

The decision to invest in Ethereum involves recognizing its diverse functionalities and its potential to offer a broader spectrum of applications beyond traditional cryptocurrencies like Bitcoin. Despite lacking the same level of brand awareness and scarcity associated with Bitcoin, Ethereum's adaptability and range of applications make it an intriguing investment option.

Is Ethereum a Good Investment - Cons

As always should be the case in proficient cost-risk analysis, now it’s time to factor-in some cons regarding the question ‘is Ethereum a good investment?’. 

Security Challenges

Ethereum faced a significant security incident in May 2016, which involved its fund-raising DAO entity. Here, despite raising $150 million in ETH, vulnerabilities in the project’s smart contract code were exploited, resulting in a hack that led to the loss of $70 million worth of ETH.

To address this, a hard fork was implemented to rectify the situation and return the stolen funds. This decision caused a split in the Ethereum blockchain, giving rise to Ethereum and Ethereum Classic. Ethereum Classic retained the original blockchain - compromising funds - while the new Ethereum blockchain reversed the hack and refunded affected individuals. Since then, Ethereum has made substantial improvements to enhance the security of its smart contract code, although the threat of cryptocurrency hackers persists.

Despite these advancements, the responsibility for securing Ethereum holdings, like any other cryptocurrency, lies with the user. While ensuring security in buying, selling, and storing Ethereum in 2023 may pose challenges, it remains a manageable responsibility for users.

The Rise of 'Ethereum Killers'

Projects such as Solana (SOL), Cardano (ADA), Tezos (XTZ), and Polkadot (DOT), have arisen as competitors of Ethereum - further leading them to be coined 'Ethereum killers. ‘These projects aim to capture a portion of Ethereum's altcoin market share by promising improved speed, functionality, and strength.

Considering the emergence of these alternatives, there is a potential risk for Ethereum to lose market share if these 'killers' outperform it in the coming years. The competition underscores the dynamic nature of the cryptocurrency landscape, urging Ethereum to continually innovate and adapt to maintain its position in the market. 

With this said, it's a good idea to keep tabs on how the ‘altcoin market share pie’ is being distributed in order to maximise your altcoin bags. 

Is Ethereum a Good Investment in 2024? - Conclusion

In summary, Ethereum stands out as one of the most stable crypto investments, second only to Bitcoin in its role as a 'store of value.' The visionary leadership of its founder Vitalik Buterin helps the blockchain distinguish itself from other DeFi innovators, as unlike those focused on short-term financial gains, Buterin's unique commitment is directed at making Ethereum the foremost smart contract platform. His dedication - fuelled by a combination of passion and genius - ensures Ethereum's steady development.

Under Buterin's guidance, Ethereum remains in capable hands. In contrast to typical reactions to market fluctuations, such as quitting or implementing mass layoffs, Buterin prioritises addressing flaws and advancing the ETH ecosystem. This approach not only tends to result in increased value but also contributes to maintaining a higher and more stable market price over the long term.

Is Ethereum a Good Investment - FAQ

Is it worth it to invest in Ethereum now?

Ethereum is frequently positioned as a favourable long-term investment over the next 1-3 years, indicating a sustained bullish trend with an anticipated rise in its price over an extended period.

Nevertheless, like any investment, acquiring ETH comes with considerable risks. The price of ETH has demonstrated high volatility, and it can experience sharp declines when market sentiment turns bearish. Despite this inherent risk, Ethereum presents substantial potential upsides. Notably, it enjoys robust brand recognition and boasts an extensive developer community, factors that contribute to its positive outlook and potential for long-term growth.

Should I buy Bitcoin or Ethereum? 

For a well-rounded diversification strategy, contemplate acquiring both Ethereum and Bitcoin.

Nevertheless, if you lean towards concentrating on a single asset, make your choice in alignment with your goals: Bitcoin is esteemed as a store of value, whereas Ethereum provides adaptability as a platform for smart contracts and applications. Evaluate your investment preferences and objectives to identify the more suitable option for your needs.

Can ETH hit $50,000?

Despite encountering challenges surpassing the $2,000 mark in 2023, Ethereum has demonstrated resilience by recording a growth of over 70% this year.

Looking ahead, the New York-based investment firm VanEck has projected a price target of $50,000 for Ethereum by the year 2030.

Will Ethereum go to zero?

Theoretically, any cryptocurrency, including Ethereum, could potentially reach a value of zero. However, the likelihood of this scenario occurring is extremely low, especially for a well-established and widely adopted cryptocurrency like Ethereum.

Will Ethereum ever be worth a lot?

Predictions for Ethereum's price in 2030 are positive, with projections indicating a potential maximum price of $20,500 and a minimum of $14,000.

Experienced analysts and market experts echo this optimistic outlook, with some envisioning Ethereum's price climbing as high as $40,000 or $50,000 by 2030.

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This article is intended for educational purposes and is not financial advice.