It’s a tall order to put $2,000 into crypto and not touch it for five years; there simply aren’t many assets that are going to hold up over time.
But the odds are very good that majors like Ethereum (ETH 3.43%) and XRP (XRP 2.76%) will, at a minimum, exist five years from now. If their development roadmaps get implemented as planned, they’ll probably even be worth more than they are now. So which one is the better choice to buy and hold with $2,000?
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Ethereum has a few different ways to win
Ethereum’s edge is that it competes in many different segments simultaneously, which gives it a handful of different paths in which it can survive and grow.
Ethereum leads the crypto sector’s decentralized finance (DeFi) segment by total value locked (TVL), with around $51.4 billion; it also has $158.6 billion in stablecoins on its chain, the most of any chain by far. Those bases of capital ensure that if a developer gets an idea about a new app to make, the chances of them finding a customer with money ready to spend are the highest on Ethereum.
So it’s no surprise that the network is home to a vast number of different projects in various verticals, some of which are successful and generate economic value for the chain, and many of which fail. But even the failures incur transaction fees and thus some additional demand for Ether, so it’s all part of the process.
Today’s Change
(-3.43%) $-70.25
Current Price
$1980.86
Key Data Points
Market Cap
$239B
Day’s Range
$1936.81 – $2055.21
52wk Range
$1398.62 – $4946.05
Volume
24B
That mixture of its ecosystem’s depth and breadth is a hedge, because even if a hot new niche cools off, another can heat up. And over the long run, it’s a huge asset that supports the coin’s value.
XRP’s narrower bet could still pay off
XRP was originally built for processing cross-border payments and more recently, compliant token issuance for financial institutions.
Its compliance features, such as transaction clawback for certain issued tokens, can make regulated asset issuers more comfortable doing business on the chain, as they mirror the real-world asset control requirements set by financial regulators. Today, it has about $461 million in distributed tokenized real-world asset (RWA) value, a sum that’s growing rapidly. The more that value flows to the XRPL over the coming years, the more demand for XRP it’ll create.
Today’s Change
(-2.76%) $-0.04
Current Price
$1.36
Key Data Points
Market Cap
$83B
Day’s Range
$1.34 – $1.40
52wk Range
$1.14 – $3.65
Volume
2.8B
Ethereum also competes quite effectively in the tokenized asset space, and it already has far more of them than the XRPL does. It doesn’t even need to win in the segment to continue growing, but the same can’t be said for XRP.
Therefore, with $2,000 in hand for a five-year hold, I would buy Ethereum. XRP is still a good purchase, but it’s just positioned in a far more focused way, which makes it a bit more brittle in comparison.
