Bitcoin is often the "main indicator" of the cryptocurrency market, and its current rise is due to several simple reasons:
1. Large institutional demand:
- Large institutions (like investment firms or banks) buy Bitcoin as a "safe haven" or hedge against inflation, especially with the approval of Bitcoin ETF funds in countries like America, which increases confidence in it.
2. High liquidity:
- Bitcoin is the most liquid and traded currency, so when new investors flow into the market, they start with it first before moving on to other currencies.
3. Volatility and confidence:
- Bitcoin is older and relatively more stable compared to other currencies (for example: Ethereum or small coins), so during periods of uncertainty or global news (wars, economic crises), investors prefer it.
4. The usual market cycle:
- Historically, Bitcoin rises first at the beginning of a "bull market", followed by other currencies later (a phenomenon called Altcoin Season).
5. Limited supply:
- The number of Bitcoins does not exceed 21 million pieces, and the upcoming "halving" (2024) reduces supply, which raises the price if demand increases.
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Why are other cryptocurrencies stable?
- Investors often wait to see if Bitcoin's rise continues before risking smaller currencies (speculation is higher in them).
- Some currencies are tied to specific projects (like DeFi, games, etc.), and if there are no news or new developments, their price does not move.
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Note:
This is a natural market cycle, and with Bitcoin stabilizing, other currencies may start to rise later. But always remember: the market is volatile, and not all jumps are logical! 🚨
(This is a simplified answer and should not be considered investment advice)$BTC