On Tuesday, the bitcoin price rallied, passing the $400 threshold and reaching $426.08 at press time. The bitcoin price increase has had a negative effect on altcoin prices. Most of the top altcoins have experienced price decreases in the past 24 hours.
Bitcoin Price Explosion Leads to Altcoin Price Drop
The bitcoin price rose more than 16% on Tuesday, increasing bitcoin’s market cap to ~$5.75 billion. Most altcoin prices are tied to the bitcoin price because bitcoin is the primary trading pair for nearly every altcoin on major exchanges. Consequently, most altcoin market caps soared along with bitcoin’s.
However, the altcoin market cap increase has masked a huge price drop for many coins. Litecoin’s market cap increased by 12% on Tuesday, but the litecoin price relative to bitcoin fell by 4% to 966,429 satoshis. Likewise, Dogecoin’s market cap rose by 9%, but the Dogecoin price fell by more than 6%. This trend continues throughout the top 50 cryptocurrencies by market cap.
In fact, Counterparty (XCP) and Fuelcoin are the only top-20 altcoins to see positive price movement during the past day. Fuelcoin–a probable pump and dump–has been in an uptrend for a while, and the Counterparty price increase is likely due to the announcement that developers have successfully ported Ethereum’s programming language into the Counterparty platform.
Presumably, the bitcoin price increase has caused investors to sell some of their altcoin holdings–or at least remove their buy orders on exchanges–to catch the bitcoin price upswing. If the bitcoin price rally reverses, those investors may return to the altcoin markets.
What do you think about the bitcoin price rally and the altcoin price decreases? Comment below!
Disclosure: The author is paid in and holds investments in bitcoin. He is not invested in or affiliated with any of the altcoins discussed in this article. Any advice contained in this article is solely the opinion of the author and does not reflect the views of CCN.com. Neither the author nor CCN.com is liable for your investing decisions, so do your homework and never invest more than you are willing to lose.
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Last modified: March 4, 2021 4:41 PM