Ethereum (ETH)
$240.03 (0.31 %) View coin
29 May 2020

What if Ether becomes digital gold?

The discussion around cryptocurrencies’ potential to become non-sovereign stores of value is often contained to just Bitcoin. This is unsurprising as Bitcoin is the most mature cryptocurrency and the one most explicitly aimed at the non-sovereign store of value use case. Bitcoin’s “Digital Gold” moniker is a great marketing tool in this regard. No other cryptocurrency has an equally clear and compelling tagline.

However, Bitcoin is not the only cryptocurrency competing for the store of value use case, and it is not impervious to competition. Other cryptocurrencies are in the running as well.

Of all the cryptocurrencies aiming for the non-sovereign store of value use case, Ethereum is by far the second leading candidate in the race. The Ethereum blockchain is the only other public blockchain with meaningful use today, and its native asset Ether (ETH) is the second largest cryptocurrency - the best measure of adoption as a potential store of value.

The points above are enough to prompt the question, “what if Ether becomes digital gold?”

At current prices, the potential ROI for ETH if it were to become a non-sovereign store of value like gold, could be more than 490x.

This sounds like a crazy proposition for an asset currently worth $22 billion, but not out of the realm of possibility when you remember that ETH is not a start-up company, it's a start-up monetary asset. Remember, Bitcoin is not impervious to competition, and if you believe Bitcoin has a shot at becoming a non-sovereign store of value like gold then many other cryptocurrencies must have a shot too, albeit less probable. Whether those other bets deserve an allocation is dependent on one’s own assessment of the risk / reward.

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