Ether, the cryptocurrency that powers the Ethereum blockchain network, is the second most valuable cryptocurrency in the world.
While Bitcoin was revolutionary in creating the entire cryptocurrency industry, Ether was arguably even more revolutionary when it was launched, with many improvements to Bitcoin’s technology, including the possibility of execute smart contracts.
It is this major innovation that has set Ether apart from the thousands of cryptocurrencies launched over the past decade.
However, like Bitcoin, like Ether also launched early, it also has its drawbacks. And these are drawbacks that many competitors take advantage of in an attempt to steal market share from Ether.
Even this week JP Morgan strategists have suggested that the ether should be worth about 55% less than it is today.
So here’s what you need to know if you have Aether, have been exposed to it, or have been thinking about going for a long time in the near future.
Competition against Ethereum
One of the biggest problems with Ether is the high transaction fees. When the grid is busy, “gas”, as it is called in the industry, can become very expensive.
This can often make certain transactions unnecessary. For example, if you have a token worth $ 50 on an exchange, but it will cost you $ 75 to send it to your wallet, clearly it’s not worth it.
It’s this main problem that has spurred a ton of innovation and a ton of other blockchain networks to offer the same services as Ether, but with much cheaper gas prices.
Can Ether survive the growing competition?
No one can predict the future, but there are several reasons Ether should be able to stand up to the competition.
First, Ether continues to be upgraded. More recently, he went through the hard fork of Ethereum London. These upgrades to the blockchain network aim to solve many of these major problems.
Moreover, Ethereum is already extremely popular, not only for uses but also for developers. And if these developers, who can earn more on the Ethereum network than almost anywhere else, are reluctant to switch blockchain networks, then Ethereum will likely continue to be the most dominant blockchain network for some time.
So while I expect other blockchain networks to gain popularity, I don’t necessarily expect Ether to lose value. It is possible that more blockchain networks will gain popularity as the industry continues to develop, without Ether necessarily losing value.
Nonetheless, if you want to expose yourself to cryptocurrencies but are still concerned about the potential of Ether, Galaxy digital backgrounds (TSX: GLXY) is one of the best stocks you can buy today.
A crypto stock to buy today
Galaxy Digital Holdings is a leading company in the cryptocurrency industry and my favorite personal investment in the space.
While it will definitely get a boost from the large Ether and Bitcoin gatherings, unlike many other cryptocurrencies, it won’t lose a ton of value if they drop in price.
This is because Galaxy has built an amazing business with multiple segments aiming to be a huge financial services powerhouse in the cryptocurrency industry.
Not only does the company have multiple segments, which helps it mitigate risk, but it also exposes investors to more growth opportunities.
While the company has an asset management division, trading segment and even investment banking services, the most opportune segment it has is its main investment division.
Galaxy identifies early and high potential investments in emerging cryptocurrency and blockchain technology. It can then invest in these projects early, exposing itself to major growth potential, as the industry continues to gain in popularity.
So if you are bullish on cryptocurrency but are worried about the long term potential of top cryptos like Bitcoin and Ether, Galaxy Digital might just be the perfect investment for you.
This article represents the opinion of the author, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We are straight! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer, so we post sometimes articles that may not conform to recommendations, rankings or other content. .
JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Fool contributor Daniel Da Costa owns shares of Galaxy Digital Holdings Ltd. The Motley Fool has no position in any of the stocks mentioned.