Ethereum is the second most popular cryptocurrency on the market. It’s only exceeded in price and market cap by Bitcoin.
This naturally begs the question, how high can the price of Ethereum go?
In our opinion and the opinion of cryptocurrency experts, the sky’s the limit when it comes to the price of Ethereum.
That’s right, Ethereum could one day have a price similar to Bitcoin. It’s actually a very strong possibility.
This article will explain our reasoning behind that conclusion.
Altcoins Are Built On The Ethereum Platform
Our first reason that Ethereum could exceed the price of Bitcoin is that the majority of altcoins are built on the Ethereum platform. What does this mean? And why is it important?
First, the Ethereum platform allows other cryptocurrencies to be built on top of the platform. This is important because it increases the exposure of Ethereum and increases demand for the Ethereum coin – Ether.
Do you remember the initial coin offering (ICO) craze in 2017?
All those ICOs involved cryptocurrencies that were built on the Ethereum platform.
Now, it’s important that these altcoins were built on the Ethereum platform because that meant the ICOs only accepted investment in Ether (the coin of the Ethereum network).
As you can imagine, the demand and price of Ether skyrocketed from that. In fact, a large portion of the demand for Ether in 2017 was a direct result of investors purchasing Ether to invest in ICOs.
This is important for precisely one reason:
There will be another ICO craze in the future. And with it, the experts all expect the price of Ether to rise in price again. Many of the experts actually expect the next ICO craze to be even larger than the one in 2017.
On the other hand, most companies that launch an ICO do not accept Bitcoin for investment. This means that Bitcoin will get left behind as the price of Ether soars due to the demand for Ether.
All in all, the propensity of companies that offer an ICO to accept Ether for investment compared to Bitcoin will result in a much larger price increase for Ether than Bitcoin.
The best part of this is that’s not the only reason the price of Ether could exceed the price of Bitcoin.
Smart Contracts Add Value
Another huge advantage of the Ethereum platform is the ability for users to create smart contracts. We know, you’re probably wondering, “what’s a smart contract?”
Basically, a smart contract is a contract between two or more parties that will automatically disburse funds held in escrow when the contract is complete. No third party is involved.
The contract simply follows a piece of computer code on the blockchain.
This is especially useful for gambling. Here’s an example of a smart contract:
Party A makes a bet with Party B that Manchester United will win a football match. Both parties must place enough funds to cover the contract.
If Manchester United wins the match, then the smart contract is fulfilled and Party A receives the funds from Party B. The opposite is true if Manchester United loses the match.
All of this is automated on the blockchain, so neither party can reverse the smart contract once it has been placed on the blockchain. Once the terms have been fulfilled, the contract is completed and the funds are disbursed to their respective party or parties.
Now, smart contracts have more uses than just gambling, but they are huge for gambling.
Do you know the best part about smart contracts?
They are most popular on the Ethereum platform, which means that the most popular cryptocurrency for a smart contract is Ether.
In addition to that, smart contracts have been gaining popularity since 2017. We expect that trend to continue due to the safety of using a smart contract rather than an escrow service.
Lower Fees Than Bitcoin
Ethereum isn’t usually used for transactions because better alternatives exist (Litecoin, Bitcoin Cash).
However, Ethereum usually has lower fees than Bitcoin, so it’s reasonable to think it could become the de facto cryptocurrency for transactions.
This is somewhat unlikely, though. We only mention it because it is something worth considering if you are interested in investing in Ether.
It Has No Competition
Ethereum has no real competition. The only competition it has are the various hard forks from the Ethereum main fork.
Other than that, Ethereum has no competition when it comes to platforms that allow individuals to build their own cryptocurrency on the network.
The same cannot be said about Bitcoin – the most popular and valuable cryptocurrency. Bitcoin has competition from many different cryptocurrencies. Some of the competition to Bitcoin includes Litecoin, Monero, and Bitcoin Cash.
In fact, the competition for Bitcoin is fairly strong. Monero is more privacy focused than Bitcoin. Litecoin and Bitcoin Cash are both faster with lower transaction fees than Bitcoin.
What does all the competition mean?
It’s very reasonable to think that Bitcoin could lose market share and value in the coming years as the better alternatives gain popularity and market share in the cryptocurrency marketplace.
In our opinion, this is a very real possibility in the long-term future. However, it’s not a short or even medium term concern for Bitcoin.
It’s The Second Most Popular Cryptocurrency
Ethereum is the second most popular cryptocurrency in terms of market cap and price. As mentioned earlier, it’s only exceeded in price by Bitcoin.
The experts agree that Bitcoin isn’t really the best cryptocurrency for transactions due to the higher fees, slow verification time, and the increasing mining difficulty.
Simply put, the price of Bitcoin is only as high as it is because it’s the original cryptocurrency. This begs the question, is Bitcoin here to stay? Or will it fall at some point?
It’s a tough question. In our opinion, Bitcoin will falter one day in the far future, but it will be a long, slow fall from grace. It could take decades for Bitcoin to completely disappear.
In the meantime, we expect other cryptocurrencies like Ethereum and Litecoin to overtake Bitcoin in price.