During the past decade, Ethereum (ETH 1.42%) has been one of the best cryptocurrency investments that you could have possibly made. Since its launch in July 2015, Ethereum is up a head-spinning 117,000%.
But after a decade of dominance, is it time to take a closer look at up-and-coming Ethereum challengers? If these rivals ever surpass Ethereum to become the top Layer 1 blockchain network in the world, their valuations could skyrocket. If that happens, they might just help you retire as a millionaire.
Millionaire-maker math
When it comes to cryptocurrency investing, millionaire-maker math is relatively simple. The goal is to invest $1,000 in a relatively unknown cryptocurrency and then watch it explode in value 1,000-fold. Doing so would help to transform $1,000 into $1 million.
That was the playbook with Bitcoin, which once traded for just $100 and now trades for almost $100,000. And it was also the playbook with Ethereum, which once traded for just $3 and now trades for $3,000.
CRYPTO: ETH
Key Data Points
That's why I'm more interested in the next Ethereum than Ethereum itself right now. From my perspective, Ethereum does not have 1,000-fold upside anymore. The math simply does not work.
If Ethereum skyrockets in value by 1,000-fold during the next decade, then it would imply a future market cap of $300 trillion. That's simply unfathomable: It's more than 200 times the current valuation of Bitcoin. And it's nearly four times the size of the entire global stock market.
Possible millionaire-maker options
So, with that math lesson in mind, I've put together a short list of potential millionaire-maker candidates using just a few simple rules.
Image source: Getty Images.
First, the cryptocurrency must be a Layer 1 blockchain network with at least an outside chance of supplanting Ethereum one day. For now, I'm ruling out any Layer 2 blockchain networks that run on top of Ethereum.
Second, the cryptocurrency must have a market cap of about $1 billion. Roughly speaking, a 1,000-fold gain would be able to transform that $1 billion into $1 trillion. That's a huge number, but not out of the range of possibility. It's roughly half the size of Bitcoin's $1.9 trillion market cap, and roughly 2.5 times the size of Ethereum's roughly $400 billion market cap.
Third, the cryptocurrency must be trading for a low price of just a few dollars. This makes it possible to acquire a sizable stake in the cryptocurrency with just $1,000. Remember: The goal is to transform $1,000 into $1 million, and I'm using that as my starting point.
Using these three basic rules, a handful of names emerge as viable options, including Aptos (APT 0.17%), a buzzy Layer 1 blockchain network that launched in late 2022 with the help of blockchain developers from Meta Platforms. Aptos currently trades for a price of less than $2 and has a market cap of $1.2 billion.
Who's not on the list?
A few big names are not on my list. For example, I've crossed off Solana, Avalanche, Cardano, and Sui -- they have market caps that are unfortunately too big to make them viable millionaire-maker options. These might be splendid investments, but the math simply doesn't work.
I've also ignored several Layer 2 blockchain networks that run on top of Ethereum. These include Optimism, with a $600 million market cap, and Arbitrum, with a $1.1 billion market cap.
And I've also ignored several blockchain networks with billion-dollar market caps that are far too specialized for what I'm trying to accomplish.
I'm looking for the next Ethereum -- a sprawling, diverse blockchain ecosystem that's good at just about everything. Back in December 2022, I specifically pointed to Aptos as the next Ethereum.
The choice facing crypto investors today
Investors have two basic options. They can go with the longtime market leader and hope for an encore performance during the next decade. Or, they can scour the crypto universe to find undiscovered investment opportunities that look a lot like Ethereum did back in 2015.
If you're a risk-averse investor, go with Ethereum. But if you're willing to take on extraordinary risk in the hopes of transforming $1,000 into $1 million, then go with an up-and-coming Ethereum challenger capable of generating huge 1,000-fold returns.
