How much does Bitcoin affect other cryptocurrency?

[KingsDen]

Thanks for all great replies. I will check them all! 

Bitcoin is the king and when the king sneezes, everyone shivers. When bitcoin is in the bear lane, other coins (altcoins) follow and vice versa.
That is why myself and many other people do not believe in diversification in cryptocurrency. You cannot hold bitcoin and want to diversify in altcoins. It is the same risk and even worse risk.
If you invest in bitcoin or altcoin then diversify to gold, Real Estate etc.

Again, Op I do not think you want to invest in a stable altcoin (USDT). It will not give you RoI.

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[hatshepsut93]

My real question maybe is. If cryptocurrency´s follow each other. whats the difference if you invest in BTC or ETH or USDT for example.

They don't follow each other, the altcoins follow Bitcoin, not the vice versa. And this is just a macro trend, it doesn't mean that there's no other price movements. People buy altcoins because they can jump by 50% in an hour randomly, without Bitcoin doing any significant moves. But people dismiss that altcoins just as easily crash, and in long term they all crash to zero and get delisted and forgotten when they have low volumes.

Trading altcoins is more like gambling than investing, it's a game of a bigger fool - they don't create anything valuable for society that could justify their price.

[ItsCrafty]

Bitcoin is the king and when the king sneezes, everyone shivers. When bitcoin is in the bear lane, other coins (altcoins) follow and vice versa.
That is why myself and many other people do not believe in diversification in cryptocurrency. You cannot hold bitcoin and want to diversify in altcoins. It is the same risk and even worse risk.
If you invest in bitcoin or altcoin then diversify to gold, Real Estate etc.

Again, Op I do not think you want to invest in a stable altcoin (USDT). It will not give you RoI.

I agree with you that Bitcoin is the king of all cryptocurrency markets,but one thing I have noticed,That when the price of bitcoin falls, if bitcoin falls 10 percent, all altcoins fall 20 to 25 percent,And this is beyond my understanding

Diversification is an excellent strategy in cryptocurrency.This is how you divide your capital into different cryptocurrencies.People adopt this method to protect their assets from loss,because investing in a single coins is risky.If a project fails, all your capital can be lost.

The advantage of investing in different cryptocurrencies is that if unfortunately one of the coins goes to zero, the rest of your capital is protected,And if one or two of the remaining crypto-currencies increase in value, then your loss will be covered and your profit will also be made.

[ektotanes]

Bitcoin really affects all other cryptocurrencies. Bitcoin is the main one here, and altcoins just follow it.

As you understand, there is no point in holding a bunch of coins, you only need bitcoin 

[ringgo96]

currently bitcoin is indeed very influential for other altcoins, because every bitcoin movement increases, other altcoins must follow the flow of bitcoin, in fact they have their own values ​​and there are very many differences in each coin that is present especially coins like ETH and bitcoin which appear very much different so for investing at this time we definitely get different benefits for each coin that we hold, because they have their own characteristics, for example the USDT coin is stable and there will not be a big increase in price and like bitcoin for example, it all depends on each coin each though the stream they follow is still bitcoin.

[G_Besar]

Bitcoin really affects all other cryptocurrencies. Bitcoin is the main one here, and altcoins just follow it.

As you understand, there is no point in holding a bunch of coins, you only need bitcoin 

I have also considered that holding Bitcoin is actually more than enough because other cryptocurrencies are also not necessarily better than Bitcoin so for now I am no longer so concerned with altcoins although apart from Bitcoin I still hold stablecoins to maintain the value of my assets when I haven't used them to spend any other asset I want. I mean, for now I'm just more concerned with Bitcoin and not giving so much headache to altcoins or anything other than Bitcoin, (except stablecoins).

[Mr. Magkaisa]

    -   I just noticed that since Bitcoin is the most popular and useful in the world, when its value increases in the market, most of the altcoins that are often included in the top 100 list also increase their prices.

And when the value of bitcoin falls, the value of other cryptocurrencies also fall, meaning that the impact of Bitcoin is strong regardless of its price in the market.

[Agbe]

Bitcoin is the key points of the crypto world, but USDT is just a stable coin and as such you will not get the same performance as if you invested in bitcoin or ethereum, The value of altcoins is highly correlated with the
 increase/decrease of Bitcoin. USDT is a stable coin and the price is supposedly pegged to the US dollar so even if there is an increase or decrease in bitcoin price, it doesn’t affect the value of USDT like that. And but it all depends on each coin they follow is still bitcoin.USDT coin is stable. The price of bitcoin is high then the price of ETH as well as other altcoins will also rise, even more exponentially than bitcoin, and vice versa.

[cydrix]

Please remember that Bitcoin is the first cryptocurrency on the market. All of the other cryptocurrencies that you see today were developed after bitcoin found success. Therefore, whether or not the cryptocurrencies follow bitcoin is not up for discussion.

I believe that bitcoin is the primary driver of the entire altcoin market. and closely resembles its course. However, there are a few glaring outliers.  The impact was initially 100%, but after the introduction of stablecoins, it has somewhat decreased.

[Aikidoka]

   -   I just noticed that since Bitcoin is the most popular and useful in the world, when its value increases in the market, most of the altcoins that are often included in the top 100 list also increase their prices.

And when the value of bitcoin falls, the value of other cryptocurrencies also fall, meaning that the impact of Bitcoin is strong regardless of its price in the market.

I agree with you that Bitcoin has a significant impact on the entire crypto market. So When Bitcoin's price increases, many investors and traders may shift their focus to Bitcoin which can lead to a decrease in trading volume and demand for altcoins. As a result, the prices of altcoins can decrease.

On the other hand, when Bitcoin's price decreases, some investors may view altcoins as a potentially more profitable investment and may shift their focus from Bitcoin to altcoins. This increase in demand for altcoins can lead to an increase in their prices.

It's important to say that different altcoins can be impacted to varying degrees by Bitcoin's price movements. Some altcoins may be more closely correlated with Bitcoin due to similarities in technology, while others may have their own unique factors and couldn't be affected by bitcoin's movement.

[riantolie]

Please remember that Bitcoin is the first cryptocurrency on the market. All of the other cryptocurrencies that you see today were developed after bitcoin found success. Therefore, whether or not the cryptocurrencies follow bitcoin is not up for discussion.

I believe that bitcoin is the primary driver of the entire altcoin market. and closely resembles its course. However, there are a few glaring outliers.  The impact was initially 100%, but after the introduction of stablecoins, it has somewhat decreased.

Also most regular people don't even know about anything besides Bitcoin, lol. So it's not surprising that it's Bitcoin that drives the whole market and not the other way around.

[el kaka22]

I think it impacts each other and I talked about this before. I know that people think when bitcoin goes down the altcoins goes down as well or when bitcoin goes up then altcoins go up as well, millions and millions of people trust that is the true thing but the reality is that we are not going to end up with that at all.

I think it is possible that we are going to end with them all moving together, they all go up together and go down together. Where can we understand this? We can look at the price and check the drops at the same time, if you could have two screens checking the price you will see that there are moments when people sell their bitcoin to drop the price, they are also selling their ethereum as well, or any other coin.

[bittraffic]

All other coins and tokens that are listed on the exchanges are pegged to BTC.  Almost all altcoins can be traded against BTC which is why it has the biggest volume and dominance in the market.

All other altcoins are priced in satoshis so when BTC is dumped the value of those altcoins also falls.
What happens in a way though is that altcoins' buy orders are filled.

[DeathAngel]

Literally every other cryptocurrency follows the price trajectory of bitcoin. We still see 4 year halving cycles with bitcoin from bear to bull & repeat. Pretty much every other coin follows bitcoin, it’s probably because there are so many BTC pairings on exchanges. People try to duck & dive in & out of bitcoin to take advantage of alt swings. It’s going to be a while before bitcoin stops controlling the oath other coins take.

[KingsDen]

Bitcoin is the king and when the king sneezes, everyone shivers. When bitcoin is in the bear lane, other coins (altcoins) follow and vice versa.
That is why myself and many other people do not believe in diversification in cryptocurrency. You cannot hold bitcoin and want to diversify in altcoins. It is the same risk and even worse risk.
If you invest in bitcoin or altcoin then diversify to gold, Real Estate etc.

Again, Op I do not think you want to invest in a stable altcoin (USDT). It will not give you RoI.

I agree with you that Bitcoin is the king of all cryptocurrency markets,but one thing I have noticed,That when the price of bitcoin falls, if bitcoin falls 10 percent, all altcoins fall 20 to 25 percent,And this is beyond my understanding

That is because the altcoins can easily be manipulated unlike bitcoin that has higher volume, market cap and more decentralized. It is because of the ability if altcoins to increase more than btc or decrease more than btc that makes people gamble with them.

Diversification is an excellent strategy in cryptocurrency.This is how you divide your capital into different cryptocurrencies.People adopt this method to protect their assets from loss,because investing in a single coins is risky.If a project fails, all your capital can be lost.

The advantage of investing in different cryptocurrencies is that if unfortunately one of the coins goes to zero, the rest of your capital is protected,And if one or two of the remaining crypto-currencies increase in value, then your loss will be covered and your profit will also be made.

It is very difficult to see where bitcoin is in -10% and another altcoin is in +25%. That is why I have said that such diversification is not necessary if you are a bitcoin believer because is not gona go to zero. It is whe  you are a shitcoiner you will be talking about coin going to zero.

[dragonvslinux]

Bitcoin really affects all other cryptocurrencies. Bitcoin is the main one here, and altcoins just follow it.

Well said, generally speaking I agree with this statement. For example when Bitcoin is declining in value, altcoins generally do a lot worse. Likewise when it is increasing altcoins generally do a bit better.

As you understand, there is no point in holding a bunch of coins, you only need bitcoin  

There is generally no point unless you trading/speculating short-term. For example in early 2021 there was a good opportunity to accumulate more satoshis during a 3-5 month period when numerous altcoins were outperforming Bitcoin by up to 10x, even 100x for some. But otherwise long-term 99.99% of these altcoins aren't able to keep up with Bitcoin. There are a few exceptions that continue to do so, but they are a minority and still within their first 4-6 years of existence, so it's very much unproven whether any altcoins at all will outperform Bitcoin over a 10 year+ period.

[serjent05]

Most altcoins are affected by the market trend of Bitcoin.  We have seen in history that whenever Bitcoin gets hyped, altcoin follows.  Aside from that people who are into altcoins are using the popularity of Bitcoin to get noticed.  Furthermore, Bitcoin seems to be the measuring standard of altcoin when it states its features.

Bitcoin also affects people's trust in the whole cryptocurrency Industry.  Since Bitcoin is the most dominating cryptocurrency, the altcoin market also suffers when it losses its credibility due to FUD and negative news.

[Mauser]

Are cryptocurrency holding each other hand in hand in someway or are they independent. It seems that they share something with each other that I don´t know anything about.

I don't think that crypto markets are independent, there is definitely a high correlation between bitcoin and all the other crypto coins. The only difference I would say is that bitcoins are the driving force here. On one side you have bitcoin and maybe Ethereum and on the other side all the alt coins. A big shift in the alt coin market will lead to a price change of BTC and ETH, and vice versa. The connection that all these crypto coins share are the same type of investors. Someone who holds alt coins is very likely to hold bitcoins as well. And when the investors start selling one coin there is a high chance they will sell their other coins as well. For most investors crypto currencies is only a part of their portfolio and there is always reshuffling going on depending on the news and future outlooks.

[Yatsan]

I think Bitcoin is so influential towards other cryptocurrencies especially in terms of market prices. Well, indeed there's this thing called altcoin season wherein prices of other coins are increasing in contrast with the market price behavior of Bitcoin but most of the time, Bitcoin's price action triggers either uprise and downfall of other crypto's value. One good example is previous ATH of Bitcoin wherein most of cryptos' also reached ATH and likewise when correction occured same thing happened with others. But in terms of general usage, there is I think where parallelism ends. Not all cryptos are being used in a platform even if Bitcoin is most of the time an option.

[Obito]

And when the value of bitcoin falls, the value of other cryptocurrencies also fall, meaning that the impact of Bitcoin is strong regardless of its price in the market.

Not most of the time, there are some altcoin that continues to go up even when bitcoin is going down during altseason but yes I can agree that the impact of bitcoin is strong given that the down times can be an indicator for altseason.