If we talk about virtual currencies or cryptocurrencies, Bitcoin and Ethereum are the two most popular options in the investment world. Both options have a fairly extensive background within the market launched by Bitcoin, and both are the main bet of specialized investors and brokers .
If you are a neophyte in the finance sector, you are probably wondering about the title of the article. What cryptocurrency to buy in 2020? Is it so solvent to invest in Bitcoin? Let's see what the predictions of both assets are throughout this year and the following.
Invest in Ethereum if you have little money
It is a fact. There is currently no cryptocurrency that comes close to the value of Bitcoin. The current price of 1 BTC is no less than 8,400 euros. In contrast, the current price of Ethereum is 170 euros, which facilitates capital investment for small investors who want to allocate a tiny part of their income to cryptocurrencies.
Current value of Bitcoin.
Current value of Ethereum.
However, the best thing to do when investing in cryptocurrencies is to diversify, although the bullish percentage of Ethereum has proven to be higher throughout the history of the currency, something that we will talk about next.
Long-term profitability: Ethereum takes the cake
Although the trends have varied over the years, the truth is that Ethereum has managed to establish itself as one of the most profitable currencies in the long term.
In 2017, the year in which Bitcoin reached its all-time high of 16,900 euros, Satoshi Nakamoto's coin managed to grow by a factor of more than 25 in relative values compared to the beginning of the year. The open source currency, for its part, grew by a value of more than 150 compared to the beginning of 2017 . These percentages have been declining since then, although Ethereum's percentage advantage over Bitcoin continues to hold, at least for now.
Bitcoin is the safest investment security
Precisely because of the lower volatility index of Bitcoin against Ethereum, the investment value of the first is much safer in the long term , not to mention that it is the flag currency that sets the trend of the rest of cryptocurrencies: if Bitcoin rises, the rest of the currencies go up. The same thing happens to the contrary: if Bitcoin goes down, the rest of the alternatives go down.
Evolution of Bitcoin throughout its history.
It is true that the growth factor is more limited than that of Ethereum, as we have seen previously. So is the decrease factor, which provides much greater stability in relative terms . In absolute values, Bitcoin has a greater fluctuation due to its high value in the market: going down from 8,500 euros to 6,400 does not imply the same loss of capital as going down from 170 to 120 euros.
2020 is the best year to invest in Bitcoin
As we saw in this other article, the Nakamoto virtual currency will experience a new all-time high in the middle of this year. Or at least that is what the latest predictions around Bitcoin predict, such as that of Thomas Lee, founder of Fundstrat Global Advisor.
"Bitcoin has historically traded at 2.5 times the value of its mining costs, so we could expect it to trade around $ 20,000 at some point this year"
The process that Lee mentions is known as Bitcoin Halving. This process will take place on May 23, and based on its definition, it is based on the reallocation of compensation values attributed to the different Bitcoin miners for solving new blockchains. The theory says that this value will be cut in half, which will help give a boost to the final value of Bitcoin in the market .
To this is added the possible end of the trade war between China and the United States and the holding of the Presidential Elections of the country of individual freedoms at the end of this year, something that will positively influence most virtual currencies , and more specifically in Bitcoin.
Invest in Bitcoin if you are going to use it as a bargaining chip
Have you thought about trading cryptocurrencies through the Deep Web or through electronic businesses? Bitcoin is the queen of Internet payments. Although we can make the direct conversion from ETH to BTC, the truth is that most wallets and virtual markets apply an interest that varies depending on the platform.
Therefore, it is best to always invest in Bitcoin, a currency that is compatible with all businesses that support cryptocurrencies as a payment method.
Conclusion: Bitcoin or Ethereum? Ethereum or Bitcoin?
After knowing the main advantages of each of the cryptocurrencies, it is time to draw conclusions. What cryptocurrency to buy during 2020?
If we are going to make an investment with a long-term return, opting for Ethereum is the smartest option. It is also the main option if our budget is limited , since the current value of the currency is much lower than that of Bitcoin. So is its growth and decline factor, as we have previously analyzed.
When it comes to Bitcoin, Nakamoto's coin takes the cake if we decide to make a short-term investment (and have enough capital). Expert voices speak of a sharp rise that could lead to growth in the middle of this year that could take the currency to its all-time high: $ 20,000 .
Another argument in favor of BTC has to do with its stability: being the capital currency, Bitcoin is the option that fluctuates the least in relative values. The advisable thing, in any case, is to make investments in different virtual assets . At the end of the day, the uptrend depends solely and exclusively on Bitcoin, which will allow us to obtain a gross profit in any of the cryptocurrencies that we have invested, regardless of the asset or exit value.