Should I Buy Ethereum? Can It Really Fall To Zero Now That It Is Still Only Around 15% The Price?
If ETH successfully scales and switches to POS, WHAT THEN?
It might be that your question is, since there is no halving events, could there be just more and more ETH in the future, not having the BTC type of scarcity deflation?
Well, the first point before we go deeper is that If ETH successfully scales and switches to POS, the price will soar to moon. If not, ETH will slowly wither out.
Why should there be price gains with ETH? Where do you bet the price to be 2, 3 years from now.
Let’s get in and play the coins.
Point #1
A lot of people who get introduced to BTC get sold on its capped total supply like it’s some great feature that somehow ETH didn’t consider.
You have to stop for a minute and ask why there’s inflation at all: to incentivize miners to secure the network.
Bitcoin makes the assumption that it’ll be able to run on fees alone in 100 years. How SN got to that conclusion seems more like a guess than any sort of analysis.
Even if he arrived there with an elaborate analysis, if I said that we’re building a financial system in which its security requirements were all decided upon at inception, how would that sound to you?
Humans suck at making predictions, here we’re celebrating a design choice where security parameters are “set is stone” a century in advance.
So you’d have to ask yourself: how much inflation is needed if there is x amount in transaction fees to incentivize the miners/stakers to secure the network?
The answer is that it might be a anywhere from a few percentage points, to 0% inflation to a negative inflation (in cases where transaction fees alone are sufficient).
It’s variable parameter that depends on all the info we have about network security (socio/techno/economics). That’s how ETH plans on approaching the problem, so the details aren’t set in stone yet.
There could be more ETH or less ETH at any point in the future. This unknown is seen as a flaw to BTC maximalists, but it’s just a better system in reality.
Read Also — What is Ethereum and How to Buy and Invest as a beginner
Point #2.
First, you MUST have control of your spending and accounting. It’s easy to get sucked in and start making foolish financial decisions in order to obtain cryptocurrency.
This usually looks like: user begins responsibly, buys $100, watches it go to $200 and decides to take out a second mortgage to buy more, then it crashes to $3 and user feels very sad. Know that this scenario exists and don’t let it happen to you.
Eth could very well go to $0. The changing value of Ether is a result of no one knowing what it’s actually worth and this causes speculation.
With that said, I use Eth every day to complete high value transactions on the Internet, so I believe it has significant value. On the other hand, it’s possible that a fatal flaw could be discovered in the protocol and cause it to be worthless, or a better performing platform could slowly erode the value of Ether.
Since none of these things has come close in the past four years, it lends faith to the possibility that the platform could remain robust in the future. Some people say that every day a platform exists without collapsing adds to the likelihood it will exist another day.
There are competitors, but having watched these ecosystems for a long time it appears clear to me that the competitors lack the stability and potential that Ethereum has. Many of us have owned many hundreds of project coins and have come to put all of our faith in Ethereum.
I still hold legacy coins, but Ethereum is the only platform I truly believe in.
Regarding the timing of your buy- no one knows. No one. Opinions are great, but you should do your own due diligence and trust your own gut.
Point 3
If you do decide to buy in, my advice is to buy ETH directly with fiat currency (e.g. US dollars, or whatever). If you get your ETH by buying, say, BTC, then trade the BTC for ETH, in the US, and UK, and probably elsewhere, that creates a taxable event.
If the price of the ETH you’re holding then crashes, you could be left with a large tax bill if you bought a lot (dollar-cost-wise) of ETH with BTC. This is true of all cryptos, not just ETH.
Trade one for another and the taxman sees that as a taxable disposal and will want their cut. There are nuances to this tax rule, but you’d have to research that in your jurisdiction.
I’d say never trade one crypto for another unless you know what you’re doing, and if you’re brand new to this space then I’d say never trade crypto for crypto period. Just buy ETH. Revealing my agenda there ;-)
I’d also say that if, having researched what Ethereum is and what it can and could do you decide it has a potentially bright future medium to long term, then follow through with that in your purchasing, unless underlying fundamentals change. Don’t make panic decisions based on emotion. Markets are irrational.
I’ve seen lots of bubbles, bull runs and bear markets. The current bear market is a bad one, but it still doesn’t faze me long term. Nothing has changed in the underlying fundamentals.
OK there have been delays in moving forward with the tech, but I’m prepared to be patient. I don’t see the delays as fundamental game-changing flaws at all.
The people who lose out are ultimately the ones who panic sell on the way down — unless done for carefully calculated tax reasons. (But then if it’s carefully calculated then it’s not done in a panic).
Don’t invest more than you can afford to lose, and (unless, on advice of a crypto tax expert, you are selling on the way down to deliberately make a tax loss) never sell on the way down.
Some people complain that ‘this is EthTRADER’ & is all about regular buying/selling. But the reason this subreddit exists is largely because all discussion of markets and price movement is banned on the main Ethereum subreddit, so it happens here instead. It is not a sub exclusively for regular day-traders.
Finally, there are lots of people who think ETH will go to zero, but they are mostly the ones who sold and quit. The ones with a very pessimistic view of ETH’s future probably capitulated a while back and will not see your comment.
Final Notes
I like going to the basics..
The best way to get started with Ethereum is to jump right in! There are many Ethereum-based applications that you can use today.
Here are just a few apps built on Ethereum — we rotate this list frequently!
- Gitcoin, a network of incentivized open-source developers
- Cent, a social network where you earn money by posting
- CryptoKitties, a game where you collect and breed digital collectible cats
- DAI, a stable cryptocurrency that holds value at $1 USD
How to buy all the listed Cryptocurrencies in the world.
#1. Buy from Coinbase. Visit Coinbase.com/Buy |
