Ethereum price prediction 2018: Is it too late to buy Ethereum?
Ethereum had a huge 2017, growing almost 10,000% to have a market cap of over US$90 billion. Can it keep this growth up?
Many people believe that Ethereum is the future of the Internet, given its meteoric price rise in 2017. This belief is still there, and many new Ethereum-based companies and products are popping up almost daily.
Ethereum-based ERC-20 token ICOs also exploded in 2017, with thousands of businesses raising funds this way. This was responsible for much of Ethereum's growth.
Why Ethereum could keep growing
The rise of Ether-based decentralised applications
Ethereum-based applications were one of the biggest factors behind Ethereum's meteoric rise in 2017, and this is set to continue into 2018.
There are some researchers who believe that over the next two years we could see a 10x increase in the amount of Ethereum-based applications on the market.
These applications are looking to use Ethereum's blockchain technology in just about every conceivable industry. Due to this, many backers of Ethereum believe that it is the future of the Internet and will make everything decentralised.
The more Ether-based apps, the more Ethereum's ETH token is worth
While many Ether-based companies have since created their own Ethereum ERC-20-based tokens, which are listed and able to be traded themselves, the core ETH coin still makes the most.
Despite these Ether-based applications running on their own tokens, the applications themselves still rely on ETH as "gas" to keep them running on the Ethereum network.
When people buy tokens for these companies, they usually do so by purchasing them with ETH, and as more of these companies pop up and the demand for ETH increases in order to get access to them, so will the price of ETH.
Its technology is continuously improving
One of bitcoin's biggest problems is that it struggles to scale to demand. Ethereum wants to avoid this, given that it has already had one demand scare that brought the network down last month. To combat this, there are plans for a number of big updates, notably "Casper" in 2018.
There are several improvements on the road map to eventually bring Ethereum to the point where it can handle as many transactions per second as the Visa network, while still remaining decentralised and cheap.
Casper, once it's integrated, will turn Ethereum from a proof-of-work platform into a proof-of-stake platform, which will make everything much faster and cheaper as it continues to grow.
Currently, the proof-of-work system Ethereum uses means miners need to solve complex algorithms to support consensus and keep the network running.
In the proof-of-stake world, these miners will be replaced by "stakers". These stakers will stake their coins in special wallets and be paid dividends from network fees based on how much ETH they stake.
Could Ethereum go as high as bitcoin?
Ethereum's value is currently sitting at around US$948, while bitcoin's is around US$15,000. The difference in market cap between them is around US$160 billion, with BTC sitting at US$250 billion and ETH at US$90 billion.
Ethereum's potential for growth in 2018 is potentially quite big if all the cards fall in the right place.
First, it needs to make sure it has its scaling issues sorted out to avoid another incident that takes down the network.
Second, there needs to continue to be an increase in applications built onto the Ethereum technology to keep demand for ETH rising.
And finally, it needs to keep up with competitors. The likes of Tron are coming for Ethereum, promising to do what Ethereum can do, but better. Ethereum needs to make sure it's continuously evolving to avoid these competitors taking its place.
If it manages to do all these things, it wouldn't be too crazy to imagine the price of ETH hitting US$2000 as demand keeps rising. However, it's unlikely that it will pass bitcoin's price and market cap in 2018.