Cryptocurrency analytics company Alphractal shared striking data revealing the strong correlation between the altcoin market and Bitcoin. According to the company, altcoins largely follow Bitcoin, and this is no coincidence.
According to Alphractal’s current analysis, the correlation between altcoins and Bitcoin is at 87 percent. This high rate indicates that price movements in the market are largely Bitcoin-driven. In other words, when Bitcoin falls, the altcoin market as a whole also experiences a pullback; conversely, when Bitcoin rises, most altcoins similarly gain value.
The company emphasizes that high correlation means “less price independence,” indicating that altcoins tend to move based on Bitcoin’s direction rather than their own fundamental dynamics.
According to Alphractal data, leading altcoins with high correlation to Bitcoin include XRP, XLM, ADA, COMP, and KSM. These projects appear to be more sensitive to price fluctuations in BTC.
In contrast, altcoins such as ENJ, 1INCH, SXP, TRX, and AXS are noted to have a lower correlation with Bitcoin. This indicates that these assets can sometimes exhibit price movements independent of Bitcoin. The company states that this divergence could be significant for investors.
According to Alphractal, multiple structural factors lie behind the high correlation. Real-time trading, supply and demand balance, high-frequency trading bots, and arbitrage activities between exchanges and different trading pairs all strengthen the synchronization between markets.
*This is not investment advice.
