Why an Altcoin Can Gain in Dollars and Still Lose to Bitcoin

A common mistake among newer crypto investors is celebrating a doubled altcoin position without checking what it did against bitcoin. On a recent episode of Ledger Cast, hosts Brian Krogsgard and Josh Olszewicz argued that dollar prices can hide a slow loss of ground. Their starting point is simple: if holding bitcoin alone would have produced more dollars with no trading at all, an altcoin trade has to justify its extra risk, fees, attention, and tax consequences.

The hosts laid out the two possible reasons to trade an altcoin. The first is diversification, which they conceded may be a weak argument. The second is accumulating more bitcoin. Against those goals, they listed the costs: the coin may fall behind bitcoin, the trade takes time and energy, a holder misses bitcoin fork payouts, every trade carries fees, and each sale can create a taxable event.

Their main illustration used Litecoin. Suppose a buyer put in $25 when one coin was worth 0.01 bitcoin, then sold at $50. The dollar gain is 100 percent, but if the coin is still worth 0.01 bitcoin, the trader holds no more bitcoin than before. Bitcoin was rising quickly over the same period, so the same money left in bitcoin would have grown in both currencies without a single trade. The hosts also noted that a coin bought at $100 can be much cheaper in bitcoin terms than one bought at $50 earlier, because bitcoin's rally outpaced the altcoin's.

That same bitcoin-based view also reveals cycles. Litecoin swung between roughly 0.01 and 0.02 bitcoin six or seven times in 2017, and each swing was a chance to convert into more bitcoin. Monero showed similarly clear cycles. Not every coin follows this pattern. Ethereum, after a large run, spent months consolidating against the dollar while bitcoin kept climbing, so its bitcoin value fell steadily during that stretch.

Dollar charts still have a role, according to the hosts. They can signal when a consolidation is nearing an end. In the Ethereum example, an ascending triangle, a pattern usually considered bullish, suggested a breakout could lift the coin against bitcoin. Siacoin offered a second case. Two dollar-chart signals, an exit from the Ichimoku Cloud and a break above the prior all-time high, looked like encouraging recoveries. On the bitcoin chart, the earlier signal looked like a major bottom instead. Even when Siacoin reached a new dollar high, it still had far to go against bitcoin, because bitcoin had risen so much since Siacoin's last bitcoin-denominated peak.

Krogsgard's broader view ties altcoin performance to the velocity of bitcoin's price moves more than to its price level. When bitcoin trades sideways or with low volatility, traders may move money into altcoins, which can then outpace it. When bitcoin moves fast, altcoins struggle to keep up. The exception is a broad influx of new money, which can lift bitcoin and the wider market together.

The episode also covered portfolio strategy, when to favor altcoins over bitcoin, when to move into cash, and several listener questions about time frames, Qtum's recent price action, and trendline anchoring. The hosts stressed that the material is educational and not investment advice, and that readers should do their own research before buying anything.