The majority of all crypto prices are in one way or another derived based on the price of Bitcoin. Basically, if the price of Bitcoin goes up, the dollar price of other tokens and assets also goes up.
John McAfee Weighs In
John McAfee sees this as a problem.
Does anyone else see the insanity of virtually all of crypto being tied to the value of Bitcoin?
Why for example, should Monero, whose value is its Privacy, be tied in any way to a coin that has ZERO privacy — Bitcoin?
— John McAfee (@officialmcafee) May 1, 2020
In his view, privacy coins like Monero derive their value from their privacy. Monero was trading at about $65 at time of writing. More than Litecoin, anyway.
McAfee goes out of his way to say that Bitcoin has no privacy. People in the thread go out of their way to defend Bitcoin.
#btc is king. It shouldn’t be that way of course, but it’s what we have right now. So I’m rooting for it
— STILLHODLING (@pmeneses1) May 1, 2020
McAfee counters that Bitcoin is in fact not the king of crypto. I’m not sure where he’s coming from on that one. Bitcoin trades many thousands of dollars above everything else, and is the most recognizable crypto asset.
It is not King. It's the most widely "traded" coin.
The most widely "used" coin is Monero.
If you doubt that check vendors on the Dark Web.
No-one accepts Bitcoin anymore.
— John McAfee (@officialmcafee) May 1, 2020
Because it was the first coin with the best adoption and holds the largest store of value globally?
— Big Horse (@bighorse1980) May 1, 2020
McAfee says it’s “not true anymore” that Bitcoin is the best in every important metric.
Not true anymore. Hardly anyone accepts Bitcoin these days. Everything is Monero.
— John McAfee (@officialmcafee) May 1, 2020
But, of course, it is true. And that’s why the crypto market continues to rely on the price of Bitcoin as an overriding factor in how it values everything else, including Monero and Zcash and other coins that would say they “derive their value from privacy.”
How Alts Can Find Their Own Way
What does that mean, exactly, anyway? Just because something is designed to be private doesn’t mean it’s necessarily going to be worth more. Personally, I think Monero is a great coin, but that doesn’t mean I expect it to hold a higher value because of its privacy, or somehow divorce itself from the price of Bitcoin.
In any case, for that to happen, coins like Monero and Zcash would have to launch their own fiat markets. That would give them a chance to be valued independently of Bitcoin, but the markets valuing them in BTC would still likely be dominating the price. Nevertheless, that’s the best way to get it done. Launch their own markets like LocalBitcoins. Monero has one called LocalMonero, but it’s not used enough to dictate the price of the currency really.
The price of Bitcoin is determined but a ton of large markets. Smaller cryptos don’t have that, and may never, at least not until the world is more into crypto.
For now, Bitcoin dictates the price of smaller assets. If its price goes up, so too go up the price of most assets, unless they correct, which happens frequently. Bitcoin has been in recovery mode in recent weeks, leading other coins to see a higher price, including Monero. This is nothing to be unthankful for, but it proves the point: as Bitcoin goes, so too goes the rest of the market.
The world will value other cryptos differently when we begin to see them at regular point-of-sale businesses, as things they now accept. Then we will also see ATMs for other cryptos. Monero is a likely contender, as are stablecoins. But Monero is an interesting case, and it’s already used at crypto ATMs. When we see more of these coins being used at regular retail locations, their value will vary based on more realistic factors than the Bitcoin price.
