- The euphoria around cryptocurrencies has grown invariably in last few years
- Ethereum hit a low of $86 during the global market crash during March 2020
- On 12 May 2021, ethereum registered an all-time high of $4,372.72 per unit
The gung-ho around the cryptocurrencies has grown invariably in the last few years following the increased participation from the big-ticket investors, institutional clients, as well as the retail traders. The crypto-asset market has expanded like anything with the emergence of new digital currencies including ethereum, ripple, litecoin, dogecoin and many others that presently have a low market capitalisation.
With the intensified involvement of people in cryptocurrency trading and the expansion of the crypto ecosystem across the world, a large section of people have allocated definitive funds to invest in cryptocurrencies in order to capitalise the market-beating returns.
As far as the return on investment is concerned, the cryptocurrencies have outnumbered almost all the asset classes in the recent past, be it the safe haven assets including United States dollar (USD), gold or the riskiest of assets including the penny stocks, and other market-tradable volatile securities.
Crypto & Covid
Bitcoin, the most populous crypto-asset, has garnered the attention of many investors over the years. With the onset of Covid-19 pandemic, the inclination of people, as well as the institutional buyers towards the cryptocurrencies has spiralled like anything.
Also Read | What will Bitcoin be worth in 2025?
Though, almost all the crypto-assets encountered the initial blow during the stock market crash perpetrated by the escalated worries over coronavirus. But the cryptocurrencies have managed to stage a meaningful recovery, defying all the benchmark stock indices of the world.
Particularly, ethereum touched a low of $86 during the worldwide crash on the back of rising worries as nobody was in position to ascertain the possible damage that can be caused due to the mounting infections in all the countries and the subsequently rising death toll.
Ethereum with 5,000% return
According to the historical data available with Binance, a unit of ethereum hit a low $86 on 13 March 2020. The investors’ jittery escalated inevitably, during February-April 2020, with regard to the future of every asset as the coronavirus pandemic unfolded an unforeseen chapter due to which all the big traders, investors were hesitant to bet strongly on an asset.
In the later months, the said anxiousness amidst the market participants worked well for cryptocurrencies as all the leading digital assets started gaining traction from the institutional investors.
Also Read | Ether vs Ethereum: What is the difference?
The inclusion of crypto-assets in the large-quantum portfolios by the investors gave rise to a consistency in demand for the extant cryptocurrencies, as well as the new digital assets that got highlighted in the pandemic era.
The retail investors ultimately believed that this should be the time to park money in the crypto ecosystem as all the assets have collapsed under the never-seen-before heat due to the coronavirus pandemic.
In the last 14 months, the cryptocurrencies have experienced a big reshuffle with the prices of almost all the crypto-assets hitting the ceilings, the value which was never predicted by qualified technicians.
You will be awestruck to know the returns of cryptocurrencies from the bottoms realised during the market crash orchestrated by the Covid worries.
On 12 May 2021, ethereum registered an all-time high of $4,372.72 per unit. This translates into a return of nearly 5,000% in just 14 months, 4,984.56% to be precise. This means a sum of GBP100 invested in ethereum could have turned into GBP500,000.
Ethereum price chart (15 months)
Image Source: REFINITIV
Can ethereum reach $50,000?
The unconditional surge in the value of ethereum has been due to a number of unexplained reasons as no market regulator, governing body, or an authorising agency has supervised the trading in cryptocurrencies.
All the cryptocurrencies have remained vulnerable to the announcements by the governments across the globe. The crypto ecosystem has suffered a heavy blow in history, whenever a central bank, a capital market watchdog, or a government have expressed their respective views against the usage of cryptocurrencies.
Notably, the massive price rise of all the cryptocurrencies in the present calendar year has been largely due to the belief that conventional traders, as well as investors are incorporating these assets in their portfolios very judiciously. The faith in the cryptocurrency network got a powerful cushion after the Elon Musk-controlled Tesla Inc (NASDAQ: TSLA) publicly announced to accept bitcoin as a legal means of exchange for buying their products.
The immense surge in the cryptocurrency prices, primarily including bitcoin and dogecoin, has been witnessed after the passive commentary from the centi-billionaire. Later, after a couple of months, Tesla declared that it had stopped accepting payments in bitcoins. The prices of all the cryptocurrencies suffered a major blow in the very next minutes after the news broke out.
Also Read | Will Dogecoin reach $5?
No matter how vibrant has been the history of cryptocurrencies so far, the future will be even brighter if no central bank or the governing body steps up to regulate them.
As far as the psychological mark of $50,000 for ethereum is concerned, some independent experts have predicted that it may touch it by March 2022, while some have given enough reasons for its collapse.
According to the estimates by the panel average, ethereum prices are poised to reach a level of up to $19,842 by 2025. The panel had as many as 35 experts including the ConsenSys head economist Lex Sokolin and Coinmama CEO Sagi Bakshi.
The experts have predicted that ethereum will be soon receiving some of the so-called long-awaited upgrades, following which the crypto-asset will overpower the dominance of bitcoin. The apparent upgrades are likely to alleviate the high costs of crypto mining.