Riding the Bear’s Coattails

Yeah, I feel ya
Poor pupper — hang in there bud
  • What is the relationship between altcoin and Bitcoin market cap?
  • Which altcoins are strongly correlated with Bitcoin?
  • Which altcoins are not correlated with Bitcoin?
  1. Historical market data from February 1st, 2018 to August 15th, 2018. We’ll define this period as the most recent “bear market” for crypto.
  2. Coins that have at least 120 days worth of data on CMC
  3. Top 100 coins based on market capitalization. These cryptos have higher trading volume and therefore more reliable price data.

1. What is the relationship between altcoin and Bitcoin market cap?

Altcoin market cap (blue) compared to Bitcoin market cap (yellow) from February 1st, 2018 to August 15th, 2018. Altcoin market is inclusive of all altcoins listed on CMC, not just the top 100.
We generate a positive correlation correlation of 0.80 between Bitcoin and the altcoin market.
  • Coefficient of +1 indicates that the two measured variables always move in the same direction
  • Coefficient of -1 indicates that the two measured variables always move in the opposite direction
  • Coefficient of 0 indicates no observable linear relationship between the two measured variables

2. Which altcoins are strongly correlated with Bitcoin?

The area under the density function line represents the chance of getting a value between a range of correlation values.
  • 75 of the top 100 coins have a correlation of 0.55 or higher
  • 50 of the top 100 coins have a correlation of 0.76 or higher
Top 20 coins with strongest correlations Bitcoin

3. Which altcoins are not correlated with Bitcoin?

Concluding Thoughts

Acknowledgments

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Mycelias

Mycelias

Content creator, blockchain enthusiast, and data scientist based in NYC. @mycelias