A Look at How Bitcoin’s Price Movements Affect Other Cryptocurrencies

Photo: Jievani Weerasinghe on Unsplash

Intro

Bitcoin dominance refers to the percentage of the total cryptocurrency market capitalization that is controlled by bitcoin alone.

What is Market Capitalization — Essentially the total value in this context market capitalization is the total value of all cryptocurrencies added together. A short version of market capitalization is market cap.

How do I make money with this information?

A Daily Price Chart Zoomed Out

All Coins Follow Bitcoin’s Price

Take a look at the chart above. Bitcoin’s (dark blue line) the highest price and the lowest price move almost in sync with Ethereum (orange line) and Binance Coin (light blue line). This is not a coincidence this happens because Bitcoin has the highest market cap which means the most money held in any cryptocurrency is in Bitcoins. So when investors with billions of dollars begin to sell others take notice of this and begin to sell at the same time which drops all cryptocurrency prices over months.

The benefit of this is you can make vastly more money than if you were just holding Bitcoin.

$1000 in Different Cryptocurrencies

Let’s take a look at how coins with different market caps have changed in their price.

An easy way to do this is by going on CoinGecko or CoinMarketCap.
These sites have almost all cryptocurrencies ranked by market cap in USD.

Here is a list of coins with potential profits using their lowest price in 2019 compared to their highest price in 2021.

Coins in The Top 10

1. Bitcoin
   Rank: 1
   Lowest Price (2019): $3400
   Highest Price (2021): $69,000
   $1000 invested: $19,294
2. Ethereum
   Rank: 2
   Lowest Price (2019): $90
   Highest Price (2021): $4,878
   $1000 invested: $53,200

Coins in The Top 10–50

1. Polygon
   Rank: 15
   Lowest Price (2019): $0.00314
   Highest Price (2021): $2.88
   $1000 invested: $927,820
2. FTX
   Rank: 26
   Lowest Price (2019): $1.15
   Highest Price (2021): $84
   $1000 invested: $72,043

Coins Over Top 50

1. Fantom
   Rank: 76
   Lowest Price (2019): $0.00329
   Highest Price (2021): $3.46
   $1000 invested: $1,048,197
2. Enjin Coin
   Rank: 87
   Lowest Price (2019): $0.00265
   Highest Price (2021): $4.82
   $1000 invested: $1,812,953

2022 is similar to 2019 it’s the first year after the all-time high (2021).
A great time to begin buying. If you’d like more information on how to know when to generally buy/sell cryptocurrencies check out this article on Bitcoin Halving.

Ending Notes

If you take a look at the potential profit buying lower market cap cryptocurrencies has a much larger payoff but is riskier to invest in for many reasons.

You can navigate buying and selling Cryptocurrency over the long-term with ease you just need to know how.

Follow for more articles identifying the secrets of finance.
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Relevant articles will be linked below or to underlined words in the future.

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