Everyone who is directly involved in trading and investing in Crypto assets certainly understands that the market dynamics between one coin and another are very different, especially regarding the movement and risks of Bitcoin with Altcoin.
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A big issue: many Altcoins are centralized
It’s very obvious, why Altcoins are a big danger: a lack of decentralisation – or too much centralization, how we would view it.
Being centralized is making such coins very flawed and prone to hacks. Also, founders can be dishonest much more easily in a centralized project.
Decentralisation is key to make a coin less prone to hacks and Bitcoin, for example, is decentralized. And Bitcoin has proven to be very reliable.
Here traders and investors can assess (Bitcoin) as a less risky investment option and its level of resilience is also stronger due to its status as the only fully decentralized asset. Meanwhile, altcoins are not completely decentralized because their founders hold most of the coins, the market capitalization value of Altcoins is also much smaller than Bitcoin so they can be easily manipulated.
The striking differences between the two make it easy for investors to choose coins that are worth keeping in their wallets for the long term. Most people look at Altcoins as a way to get more Bitcoin in the future because they are more likely to experience a big price spike, but regardless of how they multiply the value of the investment, new Altcoins should be avoided because they are usually very risky, especially when their market capitalization is low.