Many currencies and tokens operate in the same trends in the virtual currency environment. Bitcoin is the most valuable cryptocurrency in the industry right now, and when its price structure increases, the value of other virtual digital tokens also increases. It is that powerful. And, when its power decreases, other individuals in the market are likely to follow suit.
The prices of many cryptocurrencies have dropped in recent times due to Covid-19, and it has been a challenging year. However, as per the reports, some unusual has happened. There has been a huge impact on Ethereum and Altcoins than Bitcoins due to what is happening these years. Why are cryptocurrencies losing so much money compared to the most popular digital currency?
Bitcoin ETF Updates
According to the survey, Bitcoin has recently grabbed more than half of all market capitalization. There was a statement issued by the US Securities and Exchange Commission that there would be no further judgment on the authorization of ETF. This was the big turning point for the crypto world, and it created difficulty for the traders. This decision had a very bad impact on Ethereum and Altcoins. With this announcement, many traders have sold their cryptocurrencies, but bitcoin still hold their presence in the market. Ethereum has dropped below $300,000 for the first time in over a year.
Is Bitcoin Stable?
Bitcoin's resiliency in comparison to other cryptocurrencies could be explained by the fact that traders consider Bitcoin to be a more secure digital asset at this time. The opponents of Bitcoins say pointed out that it’s extremely volatile, and yet it is more well-established than others. Investors who are new in the market and who have invested in other cryptocurrencies may transfer their cash into Bitcoin from Altcoins.
Concerns about geopolitics
Another element that could influence Bitcoin’s strength when it is compared to other crypto currencies is the geopolitical climate. Turkey's ongoing civil instability and growing economic difficulties have resulted in a substantial flow of investment capital into the bitcoin market. According to the analysis, Bitcoin has taken a major chunk of these funds.
Turkey's condition could be a preview of what would occur on a wider, worldwide platform in the next severe recession. But, according to some advocates, the real challenge to Bitcoins and is when there will be another financial disaster happens. Will a crowd of investors fall on digital currencies? Will they focus solely on one player, such as BTC? Or will cryptocurrency, like traditional financial institutions, go bankrupt?
Regardless of the various factors that have contributed to the promising performance, the essential word is relative. Bitcoin still continues to struggle because of the pandemic. Bitcoin is still in the top position, but it has lost ground since the beginning. Before making any decision that requires investing money, you must always get advice from a knowledgeable person, so that risk of losing money reduces. Bitcoin is among the best crypto currencies if invested properly.