We all know that there is a hard limit to the number of bitcoins that could ever be minted. That limit is almost 21 million BTC (minus a few Satoshis). Long term holders hope that this limit will cause the values of their coins to go up considerably due to increasing demand.
However, there is no limit to the number of shit coins that can be invented. In fact the ETH shit coin now has a market cap that is of the same order of magnitude as BTC. Furthermore it is an inflationary coin.
If many people move their capital to these alts won't this negate the benefits of the 21 million BTC limit for Bitcoin holders?
So you mean to say if we have unlimited supply of other metals like iron, copper, etc then gold prices will never increase!
No, things don't work like this. Other altcoins can give competition to bitcoin demand but can't dilute the bitcoin market. All other coins are subsidiary to bitcoin and it is still dominating market with 42% dominance.