Ethereum is proving to be one of the most favorable technology investments of all time. It was created in 2015 and since then has grown by over 1000%. To better understand what it is, Ethereum is an open source network, much more than just a digital currency. Therefore, when you purchase Ethereum you are investing in the network, and placing money into a unique transformational platform, with many of its greatest applications still to come. The digital coin of Ethereum, known as “ether”, could be speeding up the decentralisation of the world economy, and has the potential to influence many other industries. Ethereum is backed by a variety of Fortune 500 companies, who met in 2016 to discuss and join forces on developing Ethereum’s network technology. The Ether trading coin can be volatile, which can serve as an asset for traders. Ethereum Classic is the original version of the Ethereum blockchain from which the newer version was created. The newer version adopted the name Ethereum. The blockchains are not compatible, and updates on one will not affect the other. These changes led the way for the creation of the new crypto coin with a different name, leger, price and market cap.
AvaTrade ZA is an industry-leading broker with some of the best crypto trading conditions available, including the lowest crypto spreads on the market.
What is Ethereum (ETH)
Ethereum was created and introduced to the world in 2013 by Vitalik Buterin, and went live in July 2015. Developers were looking for a way to differentiate from the Bitcoin currency, and make it to be exclusive with properties stand out in a market of its own. They developed a new approach with a new platform and a more common script language. Their software allows customers to run any programme, which makes the Ethereum blockchain process and applications much more efficient than before. With Ethereum, developers can build a new type of software called “decentralised application”. This codes technology is not controlled by any individual or central system.
What are the advantages of Trading Ethereum with AvaTrade ZA?
Trading Ethereum with AvaTrade South Africa can be beneficial in ways that regular cryptocurrency exchanges do not offer.
- Short selling,
“Sell high, buy low” defines short selling which allows the trader to trade and benefit when the markets are down and then profit when they bounce back. In other words, short selling is driven by the belief that a price index will decline, allowing it to be bought back at the lower price to profit.
- High leverage,
Leverage is an advantage provided by the broker to a trader. It allows you to open a much larger position with minimal investment. Leverage can magnify your potential profits and at the same time can magnify your losses.
- Auto trading online
Autotrading refers to using software that creates automatic orders and submits them to a market exchange. These systems can perform repetitive tasks at high speed. It can also provide social copying trading or mirroring the positions of experienced traders with a proven success record, like Zulutrade does.
Trading Ethereum with AvaTrade ZA doesn’t require a wallet, since the trades are performed though our SSL secured online trading platform, this is a big advantage in avoiding potential hackers and theft. From the same platform you can trade Forex pairs and other assets as well.
✅ Why Trade Crypto CFDs With AvaTrade South Africa?
- Uncompromised Safety –
With six regulatory authorities and segregated accounts, your money is protected at all times.
- Many Cryptos to Choose From –
Trade on the wide variety of cryptos available on our trading platforms.
- No Hidden Fees –
We offer zero commissions and no bank fees on transactions!
- Crypto Never Goes to Sleep –
AvaTrade ZA is one of the few brokers offer around-the-clock service and support in 14 languages.
- Generous Leverage –
Increase your initial capital with generous leverage and get far more exposure to trade than your account balance. Up to 2:1 (for EU residents) 25:1 (for non-EU residents).
- Limit Your Risk –
You can preset profit and loss levels by using stop losses or take profit limits when you trade. Determine the maximum amount you are prepared to risk when speculating on the price, or set a price at which you want to take profits. Future orders like Buy Stops and Buy Limits are also available.
- Trade Cryptos Against Fiat Currencies –
Unlike many exchanges out there, who are restricting their clients to trade only Crypto to Crypto, our clients can trade Cryptos against Fiat currencies (USD, EUR, JPY etc.), as well.
What are the advantages of Ethereum Technology?
- The app can never be turned off
- Applications are protected against fraud and hackers due to the secured cryptography
- It cannot be censored, since the apps are based on the principle of a group decision making process
- A third party cannot make changes to any of the data
- Ethereum has more applications than Bitcoin
Mist browser is the interface and digital wallet for Ethereum users. With it people can store, trade, and manage their contracts. Mist and MetaMask (another browser) help making blockchain-based applications easily accessible. Ethereum is moving forward with its user-friendly platform, which enables people to make use of the blockchain technology.
Trade Ethereum CFD’s (Contracts for Difference) with AvaTrade South Africa and benefit from the thorough market analysis we offer on our trading educational site, where you can find daily news, updates and many other helpful tools.
Ethereum Price and Market Factors
It has been noted that Ethereum can be far more than a digital asset. Its value is in the powerful blockchain programming language called Solidity. Its goal is to be something totally different from all other coins. With its increased application, there is a rise in demand by developers for “Ether”. The price of Ethereum has soared recently and has been reaching all-time highs. Bitcoin has also been surging, and when that happens it does boost investors desire for other cryptocurrencies where gains can be acquired. Since Ethereum and Bitcoin are not competing, both can benefit when one rises. Random events can happen to affect the ether price rise or fall, such as the flash crash of Ethereum’s value overall, which took place in June 2017. The Ethereum news and crash happened within a very short span of time, literally seconds after a major sell off prompted other traders to liquidate their digital currency. However, in that situation within seconds computer algorithms were buying again and the price was recovering. As you can see the volatility of the digital currencies alters prices within second. The general public and investors all had the same questions when this happened as to how the rebound can take place and its timeline. Any strong value increase can eventually lead to a price correction. As with the cryptocurrency market or any market in general, the momentum can slow down at some point. Thirty big banks, tech giants, and other organizations including J.P. Morgan Chase, Microsoft, and Intel are uniting to build business ready versions of the software behind Ethereum. Its ability to record and execute transactions without the need of a middleman is making this blockchain technology more popular amongst businesses.
There has always been talk about ‘flippening’ in crypto circles. This is a hypothetical moment when the market capitalisation of Ethereum edges past that of Bitcoin. But it is not just talk when ‘flippening’ was suggested by Goldman Sachs. In a note to its clients in July 2021, the investment bank touted Ethereum as the coin that will eventually win the cryptocurrency race. Goldman Sachs highlighted the several advantages Ethereum has over Bitcoin, such as speed and security, as well as the blockchain network that enables decentralised finance (DeFi) and smart contracts.
At the time Goldman sent the note, the market capitalisation of Bitcoin was about $600 billion, while that of Ethereum was around $250 billion (less than half that of Bitcoin). Ethereum has been a solid number two for many years, but it is easy to see why Goldman Sachs backs it for the crown. Most dApps (decentralised applications) run on the Ethereum blockchain platform, but the last few months have seen its potential soar even further. DeFi has offered an alternative to the current centralised financial system, creating a global, open, and transparent solution that will allow anyone to borrow, save, invest, trade, or perform any financial activity within the blockchain. DeFi is already a multi-billion industry, and most projects are hosted on the Ethereum network. While DeFi is gathering pace, NFTs have literally exploded. NFTs are tokens that digitise all manner of assets on the blockchain. There is already an NFT that has been sold for $69 million, and the industry is just getting started.
Ethereum has all the credentials to make ‘flippening’ a self-fulfilling prophecy. And the Goldman Sachs thumbs-up can only affirm the belief of investors and encourage Ethereum trading.
Ethereum Trading Conditions at AvaTrade ZA
- Competitive Spreads
- Minimum Trade Size 1
- Leverage Up to
- Trading Hours 24/7
- MT4 Symbol ETHUSD
- Margin 50%
When trading with AvaTrade ZA you are trading on the price changes of the digital coin, and not physically purchasing it.
The maximum accumulated position size for Ethereum is $400,000 notional value, details in our Trading Conditions and Charges page.
Ethereum Trading FAQ
- What are some of the challenges faced by the Ethereum network?
Ethereum is second only to Bitcoin as the most capitalised, and in-demand digital currency. However, challenges remain. Between 2% – 5% of Ethereum transactions on decentralised exchanges fail, due to insufficient gas prices, or slippage. Other issues include the network’s inability to scale effectively to meet demand. The scalability challenge is largely due to the innate properties of ETH mining. With 7-15 TPS (transactions per second) compared to Visa at 45,000 TPS, it’s clear that much work needs to be done. Possible solutions include state channel, sharpening, and plasma, but in-depth study of these solutions is needed.
- How will EIP-1559 impact demand for Ethereum?
Ethereum’s upgrade to Ethereum 2.0, a.k.a. EIP-1559 represents an overhaul of the transaction-fee system for the digital currency. The fee is no longer paid to Ethereum miners, but to the network itself. The new system may result in a decreased supply of Ethereum. Vitalik Buterin co-founder of Ethereum joked that if there is decreasing supply, does that make Ethereum ultrasound money? The new network upgrade recently approved by developers could decrease Ethereum supply and prop up its price. With demand at high levels, and supply at lower levels, prices may rise. EIP-1559 (Ethereum Improvement Proposal 1559) was packaged with the London hard fork.
- Should I use leverage with Ethereum trading?
At current price levels, Ethereum is largely out of reach for many retail traders. As a South African trader of Ethereum CFDs, costs can quickly spiral. Fortunately, leveraged trades of up to 20:1 are possible for certain classifications of traders. Provided you conduct the requisite research, stick to a trading strategy, and carefully manage your investment funds, you can benefit from leverage. The volatility of crypto markets should always be borne in mind when trading derivatives. Since the CFD price is derived from the price of Ethereum, leverage can amplify your gains, but it can also multiply your losses.