Measures absolute and relative price fluctuations over several time frames and other variables.
Calculates returns in comparison to moving averages and other factors.
Measures the ability to scale, upgrade and other technological weaknesses or strengths.
Evaluates public acceptance, participation of developers and other key factors.
While some altcoins experience devastating pump-and-dumps, Bitcoin is a good representation of the whole cryptocurrency market. When you compare that to altcoins that experience pump-and-dumps as well as price changes independent of the market trend, bitcoin seems relatively consistent to the cryptomarket trends. This is not to say that the value of bitcoin has become more steady over time but there is a sense of security when investing in the most valued cryptocurrency.
In 2017, the value rose from $967.67 (in USD) to $13,844.70 by the end of the year. That’s an astronomical 1,431% growth in one year! But that pales in comparison to Ripple’s 35,259% growth in 2017 (Ripple’s value grew from $.006523 to $2.30). When compared to other cryptocurrencies, bitcoin is a relatively low risk and yields a low reward.
Because the blocks have a limited size and the network creates a block on average every 10 minutes, bitcoin blocks can only fit a limited number of transactions on them. As the network started to grow exponentially in the last several years, this has become a very big problem. 10 minutes to create a block of 1 megabyte means that the Bitcoin network can process only between 3 and 7 transactions per second versus payment gateways such as Visa that can process over 45,000 transactions per second. Read more about the issue of scalability for bitcoin here.
It is clear that bitcoin has been accepted as the leader of the cryptocurrency landscape. The Achilles heel of bitcoin is the disagreement between stakeholders over how to update the core software that runs bitcoin. This is evident in the many forks that bitcoin has experienced in the past. It’s true that none of the splits have replaced the original bitcoin but it does show the lack of trust by developers.
Bitcoin is the original cryptocurrency which was released in 2009 by Satoshi Nakamoto. Bitcoin has the largest market cap to date. Towards the end of 2017, bitcoin lost market share in the cryptomarket with many investors pouring their money into altcoins. Bitcoin will look to continue its dominance in the cryptomarket as cryptocurrencies become mainstream.