Hi guys, i have a question...
I am a uk user and im registered with Gdax and Bittrex.
I buy my Bitcoin at GDAX, and sometimes i like to hold Alt-Coins over at Bittrex.
Now my worry is this... (i have ignored fees and actual growth/retreat levels to make it simple)
Suppose i have $1000 to invest in Alt-coins and the price of Bitcoin is $10,000 and i buy 0.1 bitcoin ($1000)
Lets suppose i invest that amount in Alt-Coins and the Alt-coins grow by 50% so now my $1000 has grown to $2000 in Cryptos. Fantastic.
I sell my Alt-Coins for Bitcoin and i want to cash out the Bitcoin back into Fiat so i can see $2000 in my Bank Account...
But lets say the price of Bitcoin falls to $5000.
My $2000 will shrink to $1000 regardless of how well my Alt-coins performed, because now 0.1 of Bitcoin = $500
I know 50% may be a extreme exmaple, but the point holds that even if Bitcoin goes down 10%, my Bitcoin is worth less and hence the only
way for me to actually gain wealth is for both Bitcoin and the Alt-Coins to go up together (or for Bitcoin to stay stable and for the alt-coin to go up).
If i have misunderstood please explain, and what do you think about this?
Im not sure I understand your question. If you exchange an altcoin for bitcoins and then immediately into fiat currency, the rate of fiat per bitcoin would be unlikely to change much due to the short time span. Of course, the longer the time you would keep those assets in bitcoin, the greater the chance of significant volatility. I am a uk user and im registered with Gdax and Bittrex.
I buy my Bitcoin at GDAX, and sometimes i like to hold Alt-Coins over at Bittrex.
Now my worry is this... (i have ignored fees and actual growth/retreat levels to make it simple)
Suppose i have $1000 to invest in Alt-coins and the price of Bitcoin is $10,000 and i buy 0.1 bitcoin ($1000)
Lets suppose i invest that amount in Alt-Coins and the Alt-coins grow by 50% so now my $1000 has grown to $2000 in Cryptos. Fantastic.
I sell my Alt-Coins for Bitcoin and i want to cash out the Bitcoin back into Fiat so i can see $2000 in my Bank Account...
But lets say the price of Bitcoin falls to $5000.
My $2000 will shrink to $1000 regardless of how well my Alt-coins performed, because now 0.1 of Bitcoin = $500
I know 50% may be a extreme exmaple, but the point holds that even if Bitcoin goes down 10%, my Bitcoin is worth less and hence the only
way for me to actually gain wealth is for both Bitcoin and the Alt-Coins to go up together (or for Bitcoin to stay stable and for the alt-coin to go up).
If i have misunderstood please explain, and what do you think about this?
And of course, if the value of bitcoins would drop while you were holding altcoins, you would instead receive a greater amount of bitcoins when selling your altcoins for bitcoins.