BTC is down because all the alt coins are taking resources away from it

[kokojie]

LTC alone has 15TH equivalent of hashing power and $50M worth of USD resources, that once belonged to BTC. Not to mention the plethora of other alt coins, combined takes about 30% resource away from BTC, and it is increasing each day. BTC will eventually fade into "one of the many" cryptocoins, competing for resources in a "cryptocoin market". There will soon be a wallet that supports multiple cryptocoin, and transactions will be automatically optimized depending on market exchange rate.

[bitcon]

when bitcoin dips ltc usually has a dip also.

[gabbynot]

when bitcoin dips ltc usually has a dip also.

The LTC/USD has dropped, but the LTC/BTC price has actually gone up with today's BTC fall.

[nebulus]

I think bitcoin will dominate regardless because of the headstart it got.

[mgio]

No. No one is buying alt coins.

[Explodicle]

LTC alone has 15TH equivalent of hashing power and $50M worth of USD resources, that once belonged to BTC.

That hashing power once belonged to BTC, but that doesn't mean BTC would otherwise still have those hashes. If your GPU rig is no longer profitable on BTC you can still profit by mining LTC - if that option wasn't available you'd have to just shut it down.

If that's true, it might mean that BTC is temporarily stabilizing LTC but not vice-versa.

[nwbitcoin]

I try to be tactful on forums, but not this time - what a stupid argument!

If this was true, which it isn't, then there would only be a fixed amount of money and a fixed number of people interested in crypto currencies.

We know that isn't true because the bitcoin price went up, as more people, and more money came into the market.  Why would we not see more people come in and more money come into alt coins as well?

The reason bitcoins are going down in price is because they were over valued.  Now we are trying to find the current price, and the market will over shoot again, and they will get too cheap.  

However, the same thing is happening in the other coins too - and there are loads of Chinese, Eastern Europeans and Asians putting money in alt coins. Why?  Because they can't afford to gain on the movement of bitcoins, due to the money they need to gain an advantage of small movements.

Maybe the more established bitcoin market is also looking at altcoins, but most are not even aware that it exists.  The number of comments I've read that seem to suggest that MT Gox is the only exchange available seems to suggest this is the case - and another pointer to suggest the original OP statement is wrong!


... and relax!

[dykast]

Besides the very small amount of businesses that accept Litecoin, all of the alt-coins are useless.  The are used for only ONE thing, and that is to speculate to TRADE FOR BITCOINS! 

Ok so yeah, miners are flocking to altcoins.  Do you REALLY think there is a problem with the hash rate on the bitcoin network at this point?? Have you actually looked at how fast the hash rate is going UP?  Asic's are taking over and the gpu miners are looking for alternatives to "get more bitcoins".  Take a look, http://coinchoose.com/  Should I mine bitcoins or feathercoins right now?  Anyone with half a brain would mine feathercoins because i get 2.4 times the amount of bitcoins after trading them(at the time of this post). 

The altcoins to most people are just a get "bitcoin" rich quicker scheme. 

Altcoins is the last thing you can blame for anything negative happening to Bitcoins.

[BitcoinAshley]

Congratulations, you have discovered the free market. 

Sure, alt-coins are mostly useless aside from speculation, but they are still a non-fiat store of value, with most of the advantages of Bitcoins, and they aren't directly tied to bitcoin price so one can diversify and hedge against BTC volatility, somewhat, because, as others astutely observe, often LTC drops when BTC does. I suspect they will gradually decouple given time. A lot of folks round these parts also like PMs, and PMs are in a similar situation - it's very hard (except in a few locations) to find a brick-and-mortar store that accepts gold or silver. Yet, it is still used as a non-fiat store of value despite its current limited utility as a currency. I might find a random vendor on the internet who is a total FTC nerd and accepts FTC for whatever the vendor sells, but in the meantime, it's a mainly speculative potential hedge against fiat that's worth maybe 0.3% of my portfolio just on the chance that it pulls an LTC (I remember buying x000 LTC when it was a few cents... and now it's $3-4. Lucky me.)

Your claim that alt-coin market caps and resources are taken from bitcoin is an overstatement. Sure, a lot of that is money that would go into BTC, but also a lot of that is money that would make BTC more volatile. And much of it is simply money that WOULDN'T have gone into BTC at ALL if those coins didn't exist. What am I saying? Yes, that some people actually plan what percent of their portfolio goes into what assets. Perhaps, with a more diverse choice of "stable[-protocol] cryptocoins" than just BTC, Dude A might be comfortable putting 5% more of his portfolio into the cryptocoin asset class.

So while a portfolio might look like this - 80% fiat and fiat-based crap, 10% PMs, 10% BTC - maybe for some investors, it might look like this - 75% fiat and fiat-based crap, 10% PMs, 9% BTC, 3% LTC, 1% NMC, 1% PPC, 0.5% DVC, 0.5% FTC. Etc etc. So you see that SOME money was taken from BTC, but some was simply additional investing.