Why do most cryptocurrencies rise and fall together?

[Fortify]

Observing the cryptocurrency market, we found that although most cryptocurrencies have price differences, most of them will fluctuate with the price trend of Bitcoin. When the price of Bitcoin increases, most other cryptocurrencies will also increase, and vice versa.
Is this trend due to large accounts operating on multiple exchanges or countless retail investors carrying price differences? Or is it caused by other operations?

It's hard to pinpoint all the interconnections, hopes and fears that drive financial related transactions but I distinctly remember right after Covid started. The stock market began to crash and Bitcoin went with it - so the effect is not limited to specific assets, or sub classes within those assets. However there definitely is correlation between cryptocurrencies for all sorts of motives - you've got whales involved, which might sometimes be hedgefunds trying to take profits when things look negative and you've got people who bought in but were hoping to see rises, then they get spooked at the large amount of volatility in the market - people are happy to see it go up 10% in a day, but might get spooked if it drops 3%. It's impossible to tie these things down to one reason, because there are millions of different motivations and requirements out there.

[dunfida]

Observing the cryptocurrency market, we found that although most cryptocurrencies have price differences, most of them will fluctuate with the price trend of Bitcoin. When the price of Bitcoin increases, most other cryptocurrencies will also increase, and vice versa.
Is this trend due to large accounts operating on multiple exchanges or countless retail investors carrying price differences? Or is it caused by other operations?

It's hard to pinpoint all the interconnections, hopes and fears that drive financial related transactions but I distinctly remember right after Covid started. The stock market began to crash and Bitcoin went with it - so the effect is not limited to specific assets, or sub classes within those assets. However there definitely is correlation between cryptocurrencies for all sorts of motives - you've got whales involved, which might sometimes be hedgefunds trying to take profits when things look negative and you've got people who bought in but were hoping to see rises, then they get spooked at the large amount of volatility in the market - people are happy to see it go up 10% in a day, but might get spooked if it drops 3%. It's impossible to tie these things down to one reason, because there are millions of different motivations and requirements out there.

Fundamentals could really give out a total effect not only into a specific market but also in crypto as well on whom we do though that it wont really be affected with any external news and events which do correlate out.

This is what makes things even more confusing on the time that you do make out some decisions whether you should get in or not but its up to someones choice on making out such decision.
Correlation between prices is normal but not all the times they would be moving on the same path specially in between bitcoin and altcoins.

[mobilestrike]

Observing the cryptocurrency market, we found that although most cryptocurrencies have price differences, most of them will fluctuate with the price trend of Bitcoin. When the price of Bitcoin increases, most other cryptocurrencies will also increase, and vice versa.
Is this trend due to large accounts operating on multiple exchanges or countless retail investors carrying price differences? Or is it caused by other operations?

It's hard to pinpoint all the interconnections, hopes and fears that drive financial related transactions but I distinctly remember right after Covid started. The stock market began to crash and Bitcoin went with it - so the effect is not limited to specific assets, or sub classes within those assets. However there definitely is correlation between cryptocurrencies for all sorts of motives - you've got whales involved, which might sometimes be hedgefunds trying to take profits when things look negative and you've got people who bought in but were hoping to see rises, then they get spooked at the large amount of volatility in the market - people are happy to see it go up 10% in a day, but might get spooked if it drops 3%. It's impossible to tie these things down to one reason, because there are millions of different motivations and requirements out there.

Actually all of the investors belong to one class and they invested on a large scale on all of these assets and the are interconnected with each other in their specific investors platforms and they all stay alert about all the news on crypto these may clear your doubt because they all get informed at once of a sudden rise and fall and they all react at the same time which reflects in the markets of all of these assets. That rise or fall continue for some period of days or weeks which means that a good number of investors and traders get the alert or realize the situation later and they react later. That thing interconnect all of the assets in market movements. While the price difference of each coin is a different matter that difference is because of the demand and supple and the marketcap of the coin/asset.

[chikading2016]

Most of the crypto rise and fall together because they depend on Bitcoin if Bitcoin fall we can saw many altcoins will also fall,because there is always fear and people will surely dump Thier altcoin holdings because they are afraid to loss a big amount of profit specially to those who are newbie so I think this is normal.

[Vaskiy]

Most of the crypto rise and fall together because they depend on Bitcoin if Bitcoin fall we can saw many altcoins will also fall,because there is always fear and people will surely dump Thier altcoin holdings because they are afraid to loss a big amount of profit specially to those who are newbie so I think this is normal.

As said every altcoin is tied to bitcoin in some means. This can be a direct dependence or through some means. This is the reason why the entire market used to crash once there is decline in the market of bitcoin. Whenever there happens a market disturbance the same makes impact over the Investors. This reflects in the form of panic waves and increased selling pressure causing further drop in price. When there is positive news associated with bitcoin, there'll be growth and the same gets followed by altcoins.

[Anguwa]

Observing the cryptocurrency market, we found that although most cryptocurrencies have price differences, most of them will fluctuate with the price trend of Bitcoin. When the price of Bitcoin increases, most other cryptocurrencies will also increase, and vice versa.
Is this trend due to large accounts operating on multiple exchanges or countless retail investors carrying price differences? Or is it caused by other operations?

The price of Bitcoin controls the crypto market as a whole. If Bitcoin experiences a bull run, some investors who hold altcoins panic and sell, causing the currency to crash to follow Bitcoin's phase. Similarly, if Bitcoin is pumping, many investors will want to invest in other altcoins in order to earn enormous profits, causing a price pump.

[Sebas.tian]

Bitcoin is king of all coin and most popular coin in cryptocurrency. Bitcoin and most coin between good relationship each other.We know when bitcoin price rise then all coin price going to rise. Now bitcoin price drop and almost coin are going to fall down in price. So i think when bitcoin price will rise again then all coin price will be rise again.

Yes, bitcoin still remain the king among other cryptocurrencies and that is why many investors like to invest more on bitcoin than any other coins in the community. When the price of bitcoin increased to $75k last year and many other coins start improving in the community that was giving other investors an opportunity to start earning from their investment. Since bitcoin price started dumping in the community and other coins are dumping too, show that many investors are using bitcoin price to determine what will happen to other coins in future. Now that many buyers are rushing to buy more of bitcoin based on the price dropped that happened few weeks ago to make people prepare for a brighter future and likewise to other coins investors.

[The Sceptical Chymist]

As said every altcoin is tied to bitcoin in some means. This can be a direct dependence or through some means.

I think I already posted in this thread, but in the past few hours I've definitely noticed bitcoin and a lot of altcoins I watch all sinking in tandem.  That doesn't always happen like that, but I'm pretty sure most of the time when bitcoin moves hard in a certain direction, the altcoin market follows suit.

That dependence you mentioned has to do with altcoins being bought/sold with bitcoin--or at least priced in bitcoin on exchanges.  I think if altcoins were traded exclusively with fiat, things would be a lot different.  That said, I don't know that's true by any means and I haven't heard any definitive explanation for the correlation. 

Maybe some PhD student in economics somewhere is doing his/her dissertation on it.  If not, I just threw a great idea at all the grad students out there.  Lol.

[andriarto]

Bitcoin is king of all coin and most popular coin in cryptocurrency. Bitcoin and most coin between good relationship each other.We know when bitcoin price rise then all coin price going to rise. Now bitcoin price drop and almost coin are going to fall down in price. So i think when bitcoin price will rise again then all coin price will be rise again.

Yes, bitcoin still remain the king among other cryptocurrencies and that is why many investors like to invest more on bitcoin than any other coins in the community. When the price of bitcoin increased to $75k last year and many other coins start improving in the community that was giving other investors an opportunity to start earning from their investment. Since bitcoin price started dumping in the community and other coins are dumping too, show that many investors are using bitcoin price to determine what will happen to other coins in future. Now that many buyers are rushing to buy more of bitcoin based on the price dropped that happened few weeks ago to make people prepare for a brighter future and likewise to other coins investors.

especially if the bitcoin phenomenon has increased, there will be many investors who are looking for altcoins to invest, in the hope that they will have big profits. The influence of bitcoin so far has not disappeared on the development of altcoins and this has happened as it was in the beginning. it seems that all investors have the same rationale, that bitcoin's behavior will also have an impact on the development of altcoins, and if most people think that, then it's not surprising that ups and downs occur together.

[boyptc]

Most of the crypto rise and fall together because they depend on Bitcoin if Bitcoin fall we can saw many altcoins will also fall,because there is always fear and people will surely dump Thier altcoin holdings because they are afraid to loss a big amount of profit specially to those who are newbie so I think this is normal.

And just as the market now.

Bitcoin shoots to $39k and then Eth has come up to $2700 after going down to $2300. This is the actual scene in the market that bitcoin has always been the leader of the market.

It goes up, the rest of the market goes up too.

That's why if it falls, and everyone is discouraged with its move, then it's for everyone to be calm as it will rebound together with the alts.

[LolliMoon_]

Observing the cryptocurrency market, we found that although most cryptocurrencies have price differences, most of them will fluctuate with the price trend of Bitcoin. When the price of Bitcoin increases, most other cryptocurrencies will also increase, and vice versa.
Is this trend due to large accounts operating on multiple exchanges or countless retail investors carrying price differences? Or is it caused by other operations?

Most cryptocurrencies are based on trading Bitcoin. If the price of Bitcoin (based on USD) falls, the other cryptocurrencies will also fall. Since the exchange price between Bitcoin and the exchanged cryptocurrency will remain the same.

[Rahman11]

Altcoins follow Bitcoin closely but there are times where altcoins make big gains against bitcoin as capital flows towards them once Bitcoin has finished its run up higher. When Bitcoin drops people convert their altcoins to btc before being able to convert to usdt. The same is true when people want to buy altcoins.

[marilynmanson21]

because BTC is the parent of all coins and if it decreases it will have an impact on all coins including new altcoins, and a decline will always occur when new investors panic when the value of btc drops 1%

[Mahanton]

because BTC is the parent of all coins and if it decreases it will have an impact on all coins including new altcoins, and a decline will always occur when new investors panic when the value of btc drops 1%

I do agree on this one on which Bitcoin is the main trend setter even though there are coins which do really have some other movement but most likely all coins below would surely
in line with the trend.If Bitcoin goes down then majority of them would be pulled down too on where we do have this kind of red days on which is pretty basic or normal to consider out.
On the time like this then panic is surely in common and this is what makes the market situation even more worst but for those who do have experience does really
know on what to do.

[Verziro]

Observing the cryptocurrency market, we found that although most cryptocurrencies have price differences, most of them will fluctuate with the price trend of Bitcoin. When the price of Bitcoin increases, most other cryptocurrencies will also increase, and vice versa.
Is this trend due to large accounts operating on multiple exchanges or countless retail investors carrying price differences? Or is it caused by other operations?

Bitcoin is the flagship asset, so of course the market will follow its path. Ethereum will probably achieve 'complete' separation in a few years, same with other assets like Cardano etc, once their mcap and # users reach much higher levels. Mass adoption will lead to separation.

[Viscore]

This is because most of the cryptocurrencies depends on  bitcoins value. When the bitcoin goes up, the majority of cryptocurrencies/altcoins  moves up also. When the bitcoin price goes down, then all other cryptocurrencies also move in the same direction. Thats the reason why bitcoin is referred to as the king of all cryptocurrencies and most well-known crypto.

[Gyfts]

I think the simple reason for the downward trend in bitcoin prices that also affects other coins is because bitcoin is the mother of all coins.

and another reason is that Crypto Assets price volatility is mostly based on hype which often keeps interest high. The price drop can be affected by a post on social media and what other people in the Crypto Asset world are posting. In the area of ​​Crypto Assets, news really has a significant influence on the situation in the market.

That is actually true for stock markets as well. You think stock markets dropped because of pandemic? It didn't really dropped for pandemic at all because many many companies made even profits during that same period, but it had a huge crash because people were afraid and sold their stocks.

I know that we do not really have any proof for this or any data, but we can clearly say that even if a company is doing amazingly, if people just want to sell then they can sell and drop the price, which means a company doing amazing business but dropping in stock price, rarely ever this would happen but it is definitely something possible. The difference is that news makes a lot more impact in crypto because regulations are very harsh and volume is very little which means that crypto could be moved like crazy without a problem at all.

The stock market crashed because of the lockdowns and the perceived loss of revenue. And most companies did lose revenue. Online e-commerce platforms like Amazon lucked out because they were able to resolve their supply chain issues and keep their platform running and so their profits came from that, and the fact that physical stores were shut down. Wasn't merely just a panic sell, but legitimate projections about the volume of business that would result from an economy that was artificially shut down.

Crypto can work the same way and the market is a monolithic, so if a crash occurs, every crypto goes down. That's not to say one cryptocurrency can operate independently of another, obviously many trash alt coins tank routinely.

[rby]

Observing the cryptocurrency market, we found that although most cryptocurrencies have price differences, most of them will fluctuate with the price trend of Bitcoin. When the price of Bitcoin increases, most other cryptocurrencies will also increase, and vice versa.
Is this trend due to large accounts operating on multiple exchanges or countless retail investors carrying price differences? Or is it caused by other operations?

The price of Bitcoin controls the crypto market as a whole. If Bitcoin experiences a bull run, some investors who hold altcoins panic and sell, causing the currency to crash to follow Bitcoin's phase. Similarly, if Bitcoin is pumping, many investors will want to invest in other altcoins in order to earn enormous profits, causing a price pump.

It is the demand and supply that causes volatility in the cryptocurrency market. If nobody is demanding for a coin and ofcourse nobody is supplying that particular coin, the coin will just not fluctuate very much. Also bitcoin is like the head and the altcoins are the other parts of the body. Anything that affects head will affect other parts of the body. But something that affect one part of the body may not affect the head.

[lombok]

In other words, Bitcoin is the leader for cryptocurrencies. Many investors and retailers enter cryptocurrency through Bitcoin and there are also those who treat Bitcoin as a holding investment.

Its limited supply and 4 year halving system is able to produce a consistent increase in value for Bitcoin, of course this will be a big attraction for Investors and retailers to own Bitcoin and continue to increase their holdings.

1. One way that retailers or investors (big fund) to gaining the Bitcoin holding is doing trade with Altcoin/BTC pairs. Every price of altcoin they buy using BTC goes up, the BTC they have will also increase.

When retailers and investors, big funds come in at the same time, a lot of fresh money ends up going into Bitcoin. Demand increases and supply is limited to Bitcoin causing the price of Bitcoin to rise. After that, there are several investors, retail or big funds who also want to increase Bitcoin by making trades like the one I explained above. It's the same as Bitcoin, if a lot of it enters the Altcoin, the demand for the altcoin increases while supply is also limited, this results in an increase in price.

2. If the big funds (intitution investor) feel that they have benefited enough from the increase in the price of Bitcoin, then they will decide to sell off the Bitcoin and then prepare to buy back when the price has fallen or is cheap. When Bitcoin experiences a decline in price due to selling action, FUD, bad News, the altcoin holders were worried and panicked, then took a massive sell-off/panic selling, so that they no loss and can sell quickly.

So that's why Cryptocurrencies go up and down simultaneously, but altcoins are more volatile if bitcoin moves, especially if Bitcoin experiences a 10 to 20 percent decline, the altcoin can drop in price by more than 50 percent.

[LUCKMCFLY]

The answer to OP's question is very obvious, we all know that BTC is the King currency, it's like dad, the only currency that has a life of its own, it's something like that without BTC the other currencies would not exist, and in this crypto market this is evident, when we compare BTC with another outstanding cryptocurrency, such as ETH, ETH has a very similar chart to that of BTC and it is logical, because the movements of BTC are according to the movements of BTC, and this statement applies to all cryptocurrencies, there is none that escapes it, even tokens, the only exception is when there are coins that survive the pump and dump (but this is another case) then it means that all crypto depend if or if from the movements of BTC, it's like something like they say in my country BTC is "the dad of ice creams"