The Cryptocurrency You Should Buy in 2022 Other Than Bitcoin

aximtrade broker

The cryptocurrency market has been in the public eye in recent years following the crypto boom that took the world of investment by storm. Investors around the globe are paying more attention to digital assets which are now a prominent investment destination that entices more investors every day. The crypto hype doesn’t seem to cool down anytime soon, especially with the skyrocketing prices and promising future.  

However, some cryptocurrencies are likely deriving their value from hype rather than the actual utility. And this is why learning more about the crypto sector can help the investor to have a more informed judgment. Read more on How To Start Investing in Cryptocurrencies.

Cryptocurrencies like Ethereum, for instance, are by all means different. Its value is not driven by market trends, but it was formed based on many factors. Let’s see why Ethereum is the cryptocurrency you should buy in 2022. 

Ethereum Cryptocurrency
Source: CoinDesk

Ethereum Explained

Ethereum is more than a cryptocurrency. It is a blockchain platform for digital money, decentralized applications and payments. 

As both a cryptocurrency and a blockchain platform, Ethereum is an open-source blockchain that boosts its appeal among developers due to its potential applications. It was built on top of the Ethereum blockchain, which operates smart contracts.

Founded by Vitalik Buterin, a Russian-Canadian programmer, Ethereum was created to expand the blockchain technology usage for more than transactions. 

Ethereum has successfully became a dominant blockchain platform due to its wide range of technological functions including: 

  • Currency: paying for goods and services, sending and receiving ether using a blockchain wallet. 
  • Smart Contracts: With smart contracts, transactions can be automated, which increases the process efficiency and speed even further. Smart contracts reduce human intervention and reliance on third parties. 
  • Decentralized Finance (DeFi): Ethereum DeFi makes financial products and services accessible to anyone with an internet connection and can use Ethereum, eliminating the need for bank-regulated transactions. 
  • Decentralized Autonomous Organizations (DAOs): Internet-based business owned and managed by its members, without centralized leadership. 
  • Non-fungible Tokens (NFTs): Ethereum technology is used by many NFTs to facilitate the creation, buying and selling of digital assets. 

Similar to Bitcoin, Ether (ETH) is a scarce digital money that you can use online. It is the second-largest cryptocurrency by market cap, behind Bitcoin. The value of Ethereum has risen sharply since its creation in 2013 and is being traded near $3,100 today. Also known for its extensive growth, Ethereum price jumped to over $3,000 from about $11, increasing roughly by more than 27,000% in five years, before hitting a record high at $4,800 in November 2021.

Ethereum Cryptocurrency

 The market cap of Ethereum stands at $372 billion as of Feb 2022.

Unlike Bitcoin, which is primarily considered as a store of value, the value of ETH derives from its enablement of smart contracts in decentralized applications.

Read also: What if You’ve Invested in Cryptocurrencies One Year Ago?

Why is Ether Different? 

There are multiple cryptocurrencies and tokens that exist on Ethereum. But Ether is different, it powers and secures Ethereum. ETH can be used as collateral to generate cryptocurrency tokens on Ethereum. 

Here are some reasons why Ether is different from traditional money:

  1. Really belongs to you. Through using Ether, you are acting as your own bank. You can control your own money directly through your wallet, which is like a proof of ownership. No need ever for a third party to run your funds. 
  2. Cryptographically secured. Digital money is protected by cryptography, making your funds and transactions highly secured. 
  3. Open Source. All you need to use Ether is internet connection, and a wallet. No need for bank accounts to process payments or transactions. 
  4. Decentralized. ETH is global and decentralized. No single entity can control it. 
  5. Peer-to-peer Payments. You can easily process payments without any intermediary role. Similar to cash payments, but more secure and faster. You can do it anywhere, anytime and with anyone. 
  6. Flexible Amounts. You can only buy what you need. ETH is available as fractions, you can buy as little as 0.000000000000000001 ETH.

Why Should You Buy Ethereum? 

Ethereum enjoys several competitive features over other cryptocurrencies. It is not just a coin, it’s an entire crypto platform with a wide range of uses. It also plays a significant role in daily digital transactions. The value of ETH is derived from more than the demand and supply of ether. The size and wide scale of Ethereum have given it more credibility. Especially that many cryptocurrencies have emerged for specific purposes, and some even came up as jokes. 

On the other hand, high price volatility is a huge drawback to Ethereum. ETH can dive from $4,000 to $1,000 in a few weeks. But on the bright side, prices can also more than double in a short period. High transaction costs, known as gas fees, can be another hurdle for using ETH beside the high energy consumption. 

Ethereum is successful in standing out in the cryptocurrency market with a promising outlook. The platform is expected to switch for a new validation system later this year. Upgraded system, Ethereum 2.0, promises to reduce power usage by 99.98% while enhancing transaction capacity from 30 to 100,000 a second and more sophisticated smart contracts. 

Ready for Crypto Trading?

Now you can start cryptocurrency trading easily through AximTrade’s accounts. Open forex account in easy steps and get into the world of cryptocurrencies.

AximTrade is a fast-growing brokerage service provider in the global markets dedicated to enable forex traders with easy-to-use technology, educational resources, technical analysis, varieties of forex bonus promotions, and a highly competitive trading environment with the best trading conditions. Still not sure? Try our Copy Trade platform where you can copy trades of professional traders.

DISCLAIMER:  This content does not constitute investment recommendations. Expressed views are of our experts and don't necessarily reflect those of AximTrade. 
aximtrade broker