📉 Why Does the Entire Market Fall When Bitcoin Drops?
When Bitcoin sneezes, the whole crypto market catches a cold. But why?
🔍 Bitcoin is the anchor of crypto. It's the first, most valuable, and most recognized digital asset. Many altcoins are paired with BTC in trading, and its price direction often dictates market sentiment.
💸 Investor Psychology: When BTC falls, it signals fear, uncertainty, and doubt (FUD). Retail and institutional investors often exit altcoins first, causing wider sell-offs.
⚙️ Liquidity Flows: A large portion of liquidity is tied to BTC. When its price crashes, margin calls and cascading liquidations affect leveraged positions across the board.
📊 Dominance Factor: Bitcoin dominance reflects its share of the total crypto market cap. A drop in BTC often leads to a proportional drop in most altcoins, especially smaller-cap tokens.
🚨 Bottom Line: Bitcoin is not just a coin—it's the heartbeat of the market. Understanding its movements helps predict the rhythm of the entire ecosystem.
Do you watch Bitcoin before trading altcoins?
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