According to a report by CoinMarketCap that came out late in 2022, roughly 21,910 cryptocurrencies exist, with an overall market value of $850 billion. Despite this, only few cryptocurrencies receive the most attention and investment capital, such as Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Litecoin (LTC), Bitcoin Cash (BCH), EOS (EOS), and Binance Coin (BNB).
People mainly buy Litecoin, Bitcoin and the other top ones because they have more liquidity and better market conditions. You can buy and sell these coins on the VoltCoins platform, 24 hours a day and 7 days a week.
Correlation between cryptocurrencies
Overall, there is a correlation between cryptocurrencies, so they tend to move in tandem with each other. The reason for this is that the price of any given cryptocurrency is determined by its level of adoption, market supply and demand, and the technology behind it. Based on that, cryptocurrencies with similar functions often receive the same level of attention.
In addition, cryptocurrencies that have been adopted more widely by users tend to increase in value. The top examples here are Bitcoin, Ethereum, and Litecoin, among others, so when people buy Litecoin for example, it increases in popularity and more people buy it. That is the reason why you can buy Litecoin with us at VoltCoins as well.
Moreover, cryptocurrencies that have better technology receive more attention. A good example of this is Litecoin. Litecoin is a decentralized, open source, peer-to-peer cryptocurrency that was created by Charlie Lee in 2011 and is based on the Bitcoin protocol. Litecoin has been referred to as the silver to Bitcoin’s gold. It is one of the most popular and widely used virtual currencies today.
The main difference between when people buy Litecoin and Bitcoin is the speed of transactions, which means that Litecoin can handle more transactions per second than Bitcoin. It also uses a different algorithm for mining called Scrypt, which is designed to be more memory intensive and therefore more resistant to ASICs (specialized hardware for mining). This makes Litecoin a more secure and reliable form of digital currency.
All of this is to say that while there is certainly high correlation between cryptocurrencies, this correlation is not perfect, and some coins do rise (and fall) in value much faster than others.
Reputation, good or bad, is a self-reinforcing factor
One factor that plays a key role in the crypto sphere and other markets as well is the reputation and potentially the hype surrounding an asset, regardless of whether the reputation is good or bad. The reputation of a cryptocurrency often becomes a self-reinforcing factor. When people buy Litecoin in large quantities, for example, more and more people join the trend, resulting in an upward movement. The same applies if more and more people sell the cryptocurrency. That’s why at VoltCoins we promote safe and responsible purchasing and selling of cryptocurrencies.
In conclusion, cryptocurrencies, like any other asset, are subject to the forces of supply and demand. The price is determined by the level of adoption, the technology behind it, and other factors. While there is a correlation between cryptocurrencies, this correlation is not 100%. Additionally, reputation is a factor that has a strong influence on the value of a cryptocurrency.