Ethereum is the second-largest cryptocurrency by market capitalization. It is also the first cryptocurrency to create other use-cases for cryptocurrencies. The only utility cryptocurrencies had before Ethereum was transferring value.
This use-case scenario has made Ethereum become one of the most sought-after cryptocurrencies. Here are a few reasons that make Ethereum a superb choice for investments.
Ethereum is the First Smart Contract Capable Blockchain
Vitalik Buterin first launched Ethereum on 30th July 2015. In the Ethereum whitepaper, he outlined a new blockchain that could process smart code. He also envisioned new kinds of ecosystems.
He envisioned new kinds of applications called decentralized applications or D’Apps that could work on blockchains using what we now know as Smart Contracts. The smart contracts are the back-end code that enables the D’Apps in the first place.
It has created a new niche within the cryptocurrency space, where the open-source Ethereum Virtual Machine (EVM) is the operating system of choice for those who want to code smart applications.
Decentralized Finance (DeFi) Started with Ethereum
The use of smart contracts to create decentralized finance (DeFi) applications started with Ethereum. Since then, the world has witnessed the rise of an industry that is challenging all aspects of the old money and finance industries.
DeFi has changed the way we see money and assets. More importantly, it has changed how they work. New instruments have also become a part of the world’s financial ecosystem with the introduction of DeFI and DeFi products.
Smart Contracts Can Make Anything Possible
Smart contracts have created all kinds of possibilities. From DeFi to mortgages, ecosystems now exist on the Ethereum blockchain.
These smart contracts create different kinds of conditions for the execution of certain events. It also brings about further innovation in current systems where none was thought possible before now. Ethereum allows for the tokenization of just about anything. Non-Fungible Tokens (NFTs) are a great example of this.
Transaction Fees are Too High
With the sudden rise in the value of the Ethereum ecosystem, transaction fees have become an issue. In many cases, it even costs more to process a transaction than to create the project.
It has led many people to abandon the Ethereum blockchain and move to the smart contract-capable blockchains. There is no road in sight to end the various issues that surround the Ethereum blockchain in this regard.
The only solution (ETH 2.0) has received so many delays that nobody is sure when ETH 2.0 will be launched. But, Ethereum will be here for decades to come.
Note: Please do not invest money or assets in the financial markets that you cannot afford to lose. This article should not be construed to be investment advice and is for information purposes only.