The Crypto world market has crashed severally, however, it has always bounced back to unexpected gains. This has in many instances rejuvenated the investors’ confidence in the Cryptocurrency investment. Think of the much-talked-about crypto crash of 2017, which was so devastating, however, the Crypto industry catapulted back to viability. With the many Altcoins in the market today, there is every possibility of making considerable profits from them. Even with all this, traders need to understand that all Altcoins are dependent on Bitcoin.
The Birth of Altcoins
Let us look briefly at the history of Bitcoin. Its journey began way back in 2009. The creator’s purpose or intention was to create a universal currency that could link the source with the end-user. In other words, eliminating intermediaries. In essence, he wanted to open up the financial sector to everyone regardless of their social standing and origin. What is the relationship between Bitcoin, and Altcoins? Well, they all use blockchain technology, directly or indirectly. Remember Blockchain technology is the original technology that birthed Bitcoin. What happens is that Bitcoin being the pioneer has had its fair share of drawbacks. The drawbacks pushed developers to think of how to improve or find solutions to the challenges and that is how Altcoins have come into being. Therefore, they share infrastructure and many characteristics. However, they use different protocols when it comes to executing their mandate.
Those who are keen followers of the Crypto Market might have realized that whenever Bitcoin prices crash or fall, the prices of almost all cryptocurrencies Crash and vice versa. Since Bitcoin is the pioneer or the Firstborn in the crypto world and with a lot of influence chances are, where it goes, others follow. Anyway, let us look into “why when Bitcoin Crashes Altcoins Crash.”
It is regarded as a Reserve Currency by Many Traders
Because Bitcoin being the pioneer, many investors use it as a reserve Digital currency in the crypto industry. It is equated to the US Dollar. Another important aspect is the fact that many platforms do not accept it as an alternative to Fiat currency due to regulation issues. Therefore, traders use it as an exchange with other Altcoins. Its dominance issue when it comes to Market Cap, and Price is another reasoning that makes it the preferred currency hence tilting market operations into its favor. Most investors just compare Fiat with Bitcoin ignoring other Coins.
Most Altcoins are Photocopies of Bitcoin
After its creation, many clones came into being imitating almost all its characteristics and functioning. Litecoin uses a similar code to that of Bitcoin thereby becoming a lighter and speedy copy of the original coin. Others include Bitcoin Gold, Cash, and many more. Though they try to modify to be better than Bitcoin, they end up following its trend.
It Uses the Most Trustworthy, and secure Network
Many miners participate in its Network (PoW) Protocol. To be precise the over 18 Million Miners ensures the security, and other decentralized features are top-notch in performance.
It was the first to be born
Being the first to use the blockchain network as a digital currency it carries a lot of weight as to where other coins would go. Its popularity and performance always dictate how the crypto market would look in the future. Almost every crypto investor, came to know of cryptocurrency trading through Bitcoin hence its power to sway the market either way.
Bitcoin is the first Crypto that amplified the whole digital currency market. It has the largest usage and adaptation. Its network is the most secure thus making it have the final word in the cryptocurrency market. All experienced investors’ look upon Bitcoin’s trading trend before investing in other coins.