Many people who watch the altcoin market also watch the Bitcoin market. There is a solid reason for this, because it is said that the Bitcoin market price and the Altcoin market price are linked. Why?
What is Bitcoin?
Bitcoin is a type of virtual currency and currently has the highest market capitalization in the world. Bitcoin has the following characteristics: The price fluctuates widely, but overall it is rising and it is easy to make profits, so it is the currency that attracts the most attention. When considering investment, it is important to focus on Bitcoin. It is a coin that is expected by investors as a low-risk stock in the industry.
blockchain
The biggest feature of Bitcoin is that it uses a technology called blockchain for transactions. Blockchain acts as a ledger that keeps track of Bitcoin transactions. A block consists of a set of agreed-upon transaction records and information to connect the blocks together. It is called a blockchain because blocks are distributed and managed as a single chain.
Issued number
The number of Bitcoins issued is limited to 21 million. Since this is a specification and is programmed, it is not possible to issue more than this number. Many crypto assets have a final issuance limit. However, business operations may change depending on future operations, development, and company policies.
Half-life once every 4 years
Bitcoin halves once every four years. Halving reduces the speed at which new Bitcoins are put into circulation by half. There is such an approach because there is a limit on the number of supply as a mechanism to prevent oversupply of currency and inflation.
What is Altcoin?
Altcoins refer to all virtual currencies other than Bitcoin. This is true for Ethereum (ETH), Litecoin, Ripple (XRP), Dogecoin, Solana, Mona, etc. Of course, there are other unknown coins that are considered coins. The price of altcoins is determined by the movement of the price of Bitcoin. The number of currencies handled differs depending on the operating company, so the key is to find a currency that is likely to rise significantly in value by buying and selling. A large amount of new coins are being created, so check them out.
Why are Bitcoin and Altcoin Linked?
There is a question as to why Bitcoin and altcoins move together in the market. It is said that other altcoins correspond to Bitcoin for the following reasons. I hope that investors who are about to start exchanging (depositing, withdrawing) or trading virtual currencies will find this helpful. Also check economic news and digital data from the media.
Altcoin price
The price of altcoins is determined by the price of Bitcoin. This is because most of the altcoins are traded on the basis of Bitcoin. Since Bitcoin is considered the key currency, even famous coins such as Ethereum and Ripple are linked by Bitcoin. All over the world, virtual currency exchanges are trading altcoins denominated in Bitcoin.
AI automated trading
AI automated trading is having an impact. Automatic trading is basically a system that fails, but beginners tend to use it, and it has a big impact on the market. Automatic trading is often set to buy when bitcoin goes up and sell when it goes down, so the market is also pulled. Therefore, the correlation is very strong.
Bitcoin is the base currency
Bitcoin is the base currency in the virtual currency market. As long as the base currency remains Bitcoin, altcoins will continue to be influenced by Bitcoin. Therefore, price movements are always linked. Be sure to fully understand the market before investing, whether buying or selling. Bitcoin is an important and sought-after currency that is still growing.
Open an account
To actually start investing, you must first open an account. MEXC allows you to open an account for free, so you can easily open an account. The article below explains how to open an account, so please refer to it. It is one of the top exchanges in the popularity rankings, and compared to major exchanges such as Binance and Bybit, it has thorough security and handles many different coins, so you can invest in different coins. You can examine the value of popular altcoins, make predictions, and invest.
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