Market Correlation: How different cryptocurrencies act
Crypto currency has experienced rapid growth in recent years, many new coins have fallen apart and the existing is growing. At the same time, as with all the asset classes, there are different crypto currencies that can affect a market correlation with different characteristics. In this article, we strive for how the crypto currencies contact each other, emphasizing the most important relationships, differences and possible consequences of the investor.
Cryptumelute market review
The cryptocurrency market is closely related, and different tools affect the prices and performance of each other. This connection comes for the following reasons:
- Stock Exchange Fees : If a new cryptocurrency is listed on the stock market, it will result in fees for a stock market that are often fixed to 10-20%. These fees can significantly affect your trading volume and market connection with existing crypto currencies.
- Safety risks : Crypto currency with high safety risks may have more volatility due to increased probability of hacking or other security violations.
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Correlation between different cryptocurrencies
Relations between different curine currencies differ depending on their characteristics, use and accepting level. Here are some examples of how the Crypto currency contact each other:
Bitcoin (BTC) Vs. Ethereum (ETH) **: BTC harder to surpass the value trade due to stronger brand recognition, larger safety standards and charity use.
* Litecoin (LTC) Vs. Bitcoin Cash (BCH) : LTC has performed historically better than BCH, probably due to faster transaction speed and lower fees than BCH.
* MONERERO (XMR) Vs. Zcash (rabbit) : MONERE PRIVATE TRANSPLAY METHOD was more popular with users, resulting in higher prices than Zcash.
* Chainlink (link) Vs. Uniswap (Uni) : The relationship is fixed to the price of BTC and ETH, because it has a close connection with these two cryptic currencies.
Main correlation
Here are some key relationships between different cryptocurrencies:
* Bitcoin Vs. Ethereum : It is correlated closely, outside Bitcoin, eth in terms of market capitalization.
* Litecoin Vs. Bitcoin Cash : Moderately correlated, works better than LTC than BCH -in faster transaction speed and lower fees.
* MONERERO Vs. Zcash : In a poorly correlated, monner method of private transaction, it leads to higher prices from Zcash.
differences of cryptocurrencies
Different Crypto currencies have features that can affect market correlation:
* Security : stronger safety standards lead to better market performance and lower volatility.
* Case of Use : Different cases such as mining or payment fee affect market capitalization of each cryptocurrency.
* The adoption level : The higher level of adoption results in more liquid in the market, influencing prices and correlations.
Conclusion
A market connection between different curine currencies is a complex question in which different factors affect their interactions. Understanding these correlations can help investors make investors’ decisions when navigating the cryptocurrency market. Recognizing the most important correlations, differences and possible consequences of each CRIPTO currency, investors can better prepare for the development region of the asset class.
More investors’ tips
- Diversify your portfolio : Distribution of investment between different curine currency to reduce losses due to the market fluctuation.
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