The new year has gotten off to a promising start as far as Ethereum (ETH) and its investors are concerned. The cryptocurrency had to navigate a tumultuous 2018, but just two days into 2019, we have already seen Ethereum’s market cap jump to just over $15bn - leapfrogging the $14.7bn of Ripple (XRP).
Ethereum’s rise in the crypto-stakes stands at an impressive 7% on the start of the year at the time of writing - making the digital currency the trailblazer in a market that’s punctuated by modest gains across the board since January began.
So what does this news mean for Ethereum as we embark on a new year in the world of cryptocurrencies?
Can it finally make its mark following 2018 to forget?
This early optimism for the coming year may have been hard to foresee during 2018 that begun with Ethereum’s price standing at over $1,400 and featured lows of less than $100.
As Ethereum’s price continued to tumble, sell-offs from ICO funds further exacerbated the currency’s problems. The ICO panic selling ultimately dented Ethereum’s value to the extent where it was misleadingly low.
Even during its lowest spells over the previous 12 months, faith in Ethereum has remained high thanks to the technology embedded within the cryptocurrency. Market observer and author, Jeff Reed, sees Ethereum’s individual merits as enough to ultimately topple crypto-juggernaut Bitcoin (BTC). Reed explained,
Like Bitcoin, there is little stopping Ethereum from being an alternative currency to fiat and commodity currencies. You can conceivably trade anything using Ethereum, but this is not Ethereum’s strength in comparison to other cryptocurrencies – they can all do this. It’s rather the computing language that allows the smart contracts to exist that makes Ethereum more valuable than BTC
The Enterprise Ethereum Alliance (EEA) was born in 2017 with the aim of enabling large-scale enterprises to take advantage of the superior framework that Ethereum’s blockchain technology is based on, and already has some star-studded adopters from Microsoft (NASDAQ:MSFT), Intel (NASDAQ:INTC) and JP Morgan Chase (NYSE:JPM) to BP (LON:BP), Accenture (NYSE:ACN) and Credit Suisse (SIX:CSGN). The EEA is now the world’s largest open-source blockchain initiative with over 385 members involved and points to a bright future for the cryptocurrency even when bringing the choppy waters of 2018 into consideration.
The scalability potential within Ethereum’s blockchain can also be seen to be benefitting businesses that are intent on making the whole process of trading cryptocurrencies easier for users.
So what does the future hold for Ethereum? When the market analysis website Chepicap asked a panel of nine experts on where they see Ethereum’s value come Q4 of 2019, all but one of them foresaw considerable improvements for the cryptocurrency.
Nigel Green, the CEO of DeVere, believes that Ethereum will hit an all-time high of $2,500 by the end of the year and continue to rise into 2020. DeVere explained,
This general upswing will be fueled by three mains drivers. First, more and more platforms are using Ethereum as a means of trading. Second, the increased use of smart contracts by Ethereum. And third, the decentralization of cloud computing
Ethereum holds opportunities for decentralization that other cryptocurrencies just aren’t able to facilitate, and as such, technology expert Ian McLeod feels like the digital currency will ultimately end up taking the market dominance from Bitcoin. Moreover, it’s estimated by FOTON that a decentralized system can save the crypto market around $36 billion a year.
McLeod’s reasoning for this is because it’s only Bitcoin’s price that’s ahead of Ethereum, with the newer cryptocurrency offering much more in terms of scalability and technology.
Brian Schuster, the head of Founder Solutions at Ark Capital LLC goes further to say the sky’s the limit when it comes to Ethereum’s potential. Schuster said,
What if you believe that Ethereum is less like one individual business and more like a store of value, like gold? This gives us a potential market capitalization of roughly $10 trillion, leading us to believe that the price of Ethereum might rise as high as $100,000 per coin. We might even go one step further and say that Ethereum is not like one asset, but an asset to replace all currency that exists
The $10 trillion figure could seem unrealistic, given that the total crypto market cap stands at just over $130 billion.
While it may seem somewhat flippant to start converting your partner’s gold jewelry into cryptocurrency just yet, the decentralized nature of Ethereum gives us a glimpse into a world that’s free from governmental influence and the external effects that can influence market values. $100,000 could well prove to be a pipedream, but should the worst happen, you might ultimately feel fortunate for investing in the gold dust of Ethereum.
Author's Disclosure: Trading cryptocurrencies or investing in ICOs or related products involves risk. This is not an endorsement to invest in or trade any of the cryptocurrencies or stocks mentioned in this article.