2021 has definitely welcomed Ethereum with an open heart. It has been a wild year for ether because of multiple factors. Every day news comes out about Ethereum and other popular cryptocurrencies as their price is reaching the sky. Cryptocurrencies like Bitcoin and Ethereum have become a trading and investment tool, especially when the young generation is highly attracted to them. Investors worldwide are choosing to invest in Ethereum as cryptocurrencies like these are offering the best returns and are even compared to gold. Cryptocurrencies are considered a safe-haven asset in today’s time, and people are investing their huge sum of money in cryptocurrencies.
Ethereum is counted as the second-largest cryptocurrency in terms of market capitalization, but Ethereum’s price is reaching the sky and is setting new records. You can visit bitcointalkshow.com to start with bitcoin trading. Some crypto analysts even believe that Ethereum has the potential to even become the only largest cryptocurrency. But do you know what Ethereum’s price increasing is? What are the reasons behind its growth?
Why is Ethereum’s price reaching the sky?
Earlier, Ethereum wasn’t appreciated by people, and the price of ether was quite low. This was because people didn’t understand the amazing features that Ethereum offers that weren’t even offered by Bitcoin. Ethereum was developed following the footsteps of Bitcoin, but it overcame all the flaws of Bitcoin currency. Now in 2021, Ethereum is all set to create new records and break all the past records as this is the first time that the value of Ethereum has skyrocketed. This is the first time that Ethereum’s price reached this much in the entire history of ether.
Crypto experts have a gut feeling that Ethereum’s price will continue to rise. People who are still not convinced to invest in Ethereum must gain knowledge of all the factors behind its possible growth. The main behind its rise is that all the cryptocurrencies, including Ethereum, have followed the footsteps of Bitcoin and because bitcoin’s is rising, the crypto market is gaining prominence. Even though Ethereum lagged behind when compared to Bitcoin in the last decade, Ethereum is catching up with profits or an increase in bitcoin’s value. Another main factor is that Ethereum’s software is continuously updating and even have introduced ETH 2.0. With each passing day, new features are launched, and Ethereum’s software is updated.
Is it possible that Ethereum will crash?
Vitalik Buterin, a Russian developer, launched Ethereum in 2016. Ethereum is an open-source platform that is decentralized in nature. It is a smart contract network that supports and hosts decentralized applications (dApps). Only after few years of launching Ethereum, Ethereum 2.0 was released, an upgraded version of Ethereum that is known to offer multiple unique features, making Ethereum’s price climb.
Compared to bitcoin that only acts as a great store of value, Ethereum is the cryptocurrency used for numerous projects. This clears the question that it is unlikely for Ethereum to crash in the near future. Even crypto experts believe that it will continue to rise and it will not crash. The only possibility where Ethereum can crash is when the government announces the ban of cryptocurrencies. However, still, every investor must carefully learn about all the factors that influence Ethereum’s price and must make an informed decision.
The most important reason behind the growth of Ethereum is because it has its own tokens. The Ethereum platform is designed in a way that developers are given the authority to issue their own assets on the blockchain network. The factors that given Ethereum token their value are trust and demand, and supply of tokens. With more demand, the supply becomes less, and it will impact the price of products and will increase it. All things are clear when it comes to trust, but for sure, trading cryptocurrencies have their own risk. The cryptocurrency that has powered the Ethereum blockchain has now become the second-largest cryptocurrency in market capitalization, which makes the Ethereum blockchain the most valuable blockchain. But still, the market of cryptocurrencies is unstable, which clearly means be aware while investing or trading cryptocurrencies.