Key Points
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Ethereum has declined more than 40% this year.
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But it will recover as its blockchain expands and evolves.
Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH), the world’s two most valuable cryptocurrencies, have both declined about 40% this year. Investors avoided both tokens amid fears of rate hikes, geopolitical conflicts, and other macro headwinds. Big IPOs, such as SpaceX (NASDAQ: SPCX), also likely drew more investors away from the cryptocurrency market.
I believe both cryptocurrencies are still solid long-term investments. Bitcoin is a viable hedge against expansionary monetary policies, and Ethereum remains the largest developer-oriented blockchain. However, I’m more bullish on Ether than Bitcoin today for three simple reasons.
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A digital illustration of Ether tokens.
Image source: Getty Images.
1. Its staking yields
Ether can be staked (locked up) on Ethereum’s blockchain to earn interest-like rewards. Investors can currently earn yields of 3%-4% on staked Ether, making it a compelling (but more volatile) alternative to CDs, high-yield savings accounts, T-bills, and dividend stocks.
Bitcoin can’t be staked on its native blockchain. Therefore, Ether investors will be paid to ride out the near-term volatility, while Bitcoin investors won’t. That’s why Bitmine (NYSE: BMNR), the world’s largest corporate holder of Ether, has staked most of its 5.54 million tokens.
2. Its smart contracts
Bitcoin is a proof-of-work (PoW) blockchain that supports mining. Ethereum was once a PoW blockchain, but it transitioned to a proof-of-stake (PoS) blockchain in 2022. As a PoS blockchain, Ethereum doesn’t support token mining — but it gained support for staking and smart contracts, which are used to develop decentralized apps and other crypto assets.
Ethereum hosted nearly 32,000 active developers as of late 2025, putting it far ahead of similar PoS blockchains like Solana (CRYPTO: SOL) and Cardano (CRYPTO: ADA). When Ethereum’s network activity increases, a portion of the Ether used to pay for those transactions is burned (permanently destroyed) — which tightens up its supply and boosts its value. Therefore, if you expect developers to create more decentralized apps and tokenized assets on Ethereum, it’s a smart move to accumulate more Ether as the bulls look the other way.
3. Its expansion and evolution
Lastly, Ethereum is still expanding and evolving. To keep pace with Solana and Cardano, which process transactions faster than Ethereum’s Layer-1 (L1) blockchain, Ethereum is launching more Layer-2 (L2) networks to process its compressed data off-chain at higher speeds.
Ethereum’s developers also aim to improve the network’s scalability, reduce its congestion and gas fees, and boost its overall efficiency through three upcoming upgrades — The Verge, The Purge, and The Splurge — over the next decade. As Ethereum evolves, Bitcoin’s blockchain will remain stagnant as miners gradually reduce its remaining supply.
Should you invest in Ether today?
I invested in both Bitcoin and Ethereum through their spot price ETFs. But if I had to add more to one position over the other, I’d ramp up my investments in Ethereum because it’s still smaller and has more irons in the fire than the world’s top cryptocurrency.
Should you buy stock in Ethereum right now?
Before you buy stock in Ethereum, consider this:
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Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin, Ethereum, and Solana. The Motley Fool has a disclosure policy.