Ethereum (ETH -0.52%) is a wonderful asset to have owned in your portfolio. In the past five years, its price skyrocketed 537%. And it's up 45% in 2023. 

But as we remain in a so-called crypto winter, Ethereum has yet to reclaim its previous highs. The world's second most-valuable cryptocurrency is currently trading 64% off its peak price from November 2021.  

Should investors buy Ethereum at such a huge discount? Let's consider the bull and the bear cases with this leading cryptocurrency. 

What the bulls think 

With a market cap of $209 billion, Ethereum is by far the largest blockchain network that allows for the creation of smart contracts. These are software programs that automatically execute when two parties complete their requirements of a transaction. It makes the blockchain programmable, allowing for the creation of decentralized applications (dApps) for gaming, financial services, and non-fungible tokens (NTFs). 

There are thousands of different dApps running on Ethereum, making it the most popular network for these services. And according to Electric Capital, a venture firm, Ethereum attracts the most developers on its platform of any crypto, which bodes well for its future. By having a lot of developers, it increases the chances that game-changing innovations can be introduced. And this can help draw more users to Ethereum, driving up its value. 

Bulls are also excited about Ethereum's Merge, which transitioned the blockchain to a proof-of-stake consensus mechanism. This is considered to be a much more environmentally friendly approach to approving transactions than older proof-of-work mechanisms. And it paves the way for the crypto to better scale up in the future. If it can start to process more transactions at lower costs, then perhaps its adoption could soar since it will be able to handle a lot more activity. 

Ethereum's current price is also a key factor that might draw more interest right now. As I noted above, the cryptocurrency is well off its all-time high. The sell-off started toward the end of 2021 and carried over into 2022, driven by the Federal Reserve's aggressive interest rate increases.

Although cryptocurrencies are volatile, it's difficult to see Ethereum going away anytime soon. And this means that once investors start to take a more risk-on approach, it could be on its way to achieving a new peak price. 

What the bears think 

While the bull arguments might be compelling, there are also valid reasons someone wouldn't want to buy Ethereum right now. 

For starters, there are up-and-coming "Ethereum killers" out there: cryptocurrencies that try to develop strengths where Ethereum might be lacking. 

Two popular ones are Cardano and Solana. Using an academic, research-driven approach for introducing updates, Cardano hopes that its cautious strategy can minimize potential implementation risks, while creating enterprise-level solutions.

And Solana, which is focused on speed and scalability, can be a top network when it comes to decentralized-finance (DeFi) applications, particularly in payments. Both Cardano and Solana have also attracted a lot of developers. 

From my perspective, it's hard to truly get a firm grasp on Ethereum's seemingly unlimited number of planned upgrades. Besides The Merge, there are four other phases on tap, making the product's road map incredibly complex.

The more upgrades that need to be built and introduced, the greater the chances that something breaks with the software. Consequently, there is increased technical risk, so I wouldn't be surprised if it takes much longer than anticipated for it all to be complete from a development perspective. 

Anyone who follows the cryptocurrency industry knows who Vitalik Buterin is -- one of the founders of Ethereum. And he has tremendous influence over the direction of the protocol. But the entire point of cryptocurrencies and blockchain networks is to eliminate the need for central authorities by giving the power and decision-making control to the community. I think this could be a potential risk should Buterin implement choices that might not be in the best interest of all stakeholders. 

I can see why it might make sense for some investors to scoop up Ethereum while it's been so beaten down. But I'm not one of these people. I think the bear case outweighs the positive attributes.