Ethereum (ETH -0.17%) has been one of the hottest cryptocurrencies of the past two years, but it's taken a beating in recent months.

The crypto market as a whole has been plummeting, and the price of Ethereum is currently down close to 80% from its peak in November 2021. While that may not seem like good news, it also means that right now is an incredibly affordable time to buy.

Buying the dip can be a smart strategy, because if you invest now and Ethereum rebounds, you could see substantial earnings. So could Ethereum make you richer? Here's what you need to know.

Where Ethereum shines

Ethereum is one of the stronger cryptocurrencies out there. It's the second-largest by market cap, right behind Bitcoin (BTC -0.29%), and it's also the most popular blockchain for decentralized applications (dApps).

The Ethereum network hosts everything from non-fungible token (NFT) marketplaces to decentralized finance (DeFi) projects to metaverse applications and more. If any of these areas thrive over the long term, Ethereum could see tremendous growth.

Ethereum's most pressing problems right now are its sluggish transaction times and high fees. However, it is in the process of upgrading its network, which will make it faster, more energy-efficient, and more affordable to use.

This update should also help it compete with smaller networks like Solana and Cardano. Speed and efficiency are two of the biggest advantages smaller blockchains have over Ethereum, but once Ethereum eventually completes its upgrade, it could have an even stronger hold over the sector.

Risks to consider

The most important risk to consider when investing in Ethereum (or any cryptocurrency) is that it's still speculative.

While Ethereum could revolutionize a variety of industries with its dApps, there are no guarantees that will actually happen. If cryptocurrency and decentralized platforms never catch on with the public, Ethereum will have a tough time staying relevant.

Also, even if crypto in general succeeds, nobody knows which individual investments will stick around for the long haul. The crypto movement is still in the early stages, and new cryptocurrencies are being developed by the day. While Ethereum is currently one of the strongest networks, it's uncertain how it will fare over time.

Finally, crypto is a notoriously volatile investment. Even if Ethereum does thrive over the long term, it will likely see substantial ups and downs along the way. Before investing, be sure you're prepared for that level of turbulence.

Is Ethereum right for you?

Ethereum could potentially make you a lot of money if it succeeds over time, but crypto is also a riskier investment. There are no guarantees that Ethereum will make you rich, and there's always a chance you could lose money when investing in crypto.

If you're comfortable taking on higher levels of risk, now could be one of the best opportunities to buy Ethereum. Prices are lower than they've been in a long time, and investing now means you're buying at a hefty discount. If Ethereum does rebound, you could see significant gains.

Crypto is a highly volatile investment, but it could also be lucrative. While nobody knows for certain what the future holds for Ethereum, it remains one of the stronger cryptocurrencies out there. If it thrives over time, you could potentially make a lot of money.