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Written by Eric Lough
The last few weeks have been a wild in the cryptocurrency markets. Bitcoin reached an all time high at little over $5,000 on September 2nd and since then has taken a dive. In the last 24 hours, Bitcoin has taken around a $400 loss. This volatility in the market is not a surprise or new to those familiar with cryptocurrencies.
Though these losses are a shock to some; investors commonly look at volatility as good to an extent since it offers opportunity. Bitcoin will likely exceed well past $5,000 in the not so distant future. This means a loss in value offers an opportune time to buy cryptocurrencies to maximize profits while they are undervalued. Almost every major cryptocurrency has taken a hit as Bitcoin has lost value in the last 24 hours. Alt-coins like Ethereum and Ethereum Classic have gained and lost significant value in less than 36 hours, making alt-coin like Ethereum seem as perfect opportunities for entry into the cryptocurrency market.
Ethereum is Bitcoin’s main competitor. Although, the application of Ethereum is better more suited to conventional business models, as they exist today. Ethereum technology allows for “smart contacts”.
Bitcoin transactions can be tracked through on online anonymous ledger called Blockchain; Bitcoin transaction cannot be programmed. This breakthrough in cryptocurrency technology does not just allow for the transfer of funds but also stock, property, mutual funds, and securities without needing any third-party service provider, almost completing cutting out the middlemen who create financial friction between a household and a firm.
The potential of Ethereum has made investors take notice. Ethereum’s technology is outpacing Bitcoin, making Ethereum much more capable and lucrative for big business. Corporate giants like Chase, Mastercard, JP Morgan and others have created strong footholds in Ethereum technology forming the Enterprise Ethereum Alliance to ensure a place in cryptocurrencies’ future.
Ethereum is not as well known as Bitcoin but it has more potential for practical application in future with big business. As cryptocurrencies gain public trust, investors will encourage other investors to accept and use Ethereum to avoid fraud, inflation and exchange rates.
The migration from Bitcoin to other alt-coins with more real-world applications means it is still not too late to cash in on cryptocurrencies.
Many alt-coins such as Ethereum are currently valued less than Bitcoin but this may not be true in the future. At a less than a tenth of the price of Bitcoin, Ethereum seems like a good investment for the moderate investor to play their hand in the cryptocurrency market with little capital. Since January 1st of 2017, Ethereum has showed gains of around 2,000% increase in less than a year. Entering the market at little under $8, Ethereum is currently priced at $342, showing slight gains as markets rebound over the losses of last 48 hours.
Even though Ethereum has taken a hit along with other cryptocurrencies, the future of this technology looks bright, making them currently undervalued investments.
Ethereum may not be able to grow at the rate it has this past year. Though, based on the acceptance from investments giants like ING and BP, Ethereum will most likely increase in value in the not so distant future. The recent loss creates room to invest on a smaller level. Undoubtedly, cryptocurrencies are expected to rise in value. Ethereum is a good choice for most investors because of its moderate price and bright future with big business acceptance.
If Ethereum at its current value seems like too high of risk, Ethereum Classic allows an investor to gain entrance into the Ethereum bandwagon with even less capital. Valued around 5 percent of Ethereum, Classic Ethereum is a better investment for those with less capital but also is accompanied with more risk. Ethereum Classic was created after an attack on Ethereum network for around $50 million in Ethereum had been stolen. Ethereum Classic was a result of a “fork” in the Ethereum network. Those that held Ethereum that did not want to split Ethereum into two separate currencies were left with just Ethereum Classic. About 10 percent of Ethereum network decided to stay with Ethereum Classic for a many reasons. Both the speculatory and use case market for both Ethereum and Ethereum Classic make them both solid investments both having advantages and disadvantages depending on the investor.