I also predict that cryptocurrencies as a whole will suffer from that due to the inability of the medias to understand that Bitcoin is not representative of all blockchain technologies.
It’s a shame because today most modern cryptocurrencies are not based on proof of work.
Because economically that’s true. There is no crypto (even ETH) which could stay at its price when BTC goes up and down by a magnitude. Of course they are correlated, like INTC may correlate with APPL when markets go crazy, but this link is too rigid for all crypto under bitcoin even when it’s relatively quiet.
I don’t understand an exact reason behind this, but I believe it’s related to how crypto exchanges work internally.
The biggest (afaik) of these ETH contract-based coins, USDT, is owned by a single company, which is partially backing it by their BTC and it maintains a list of blocked tokens, which is by design. Of course small money is relatively safe, but for large capitals it’s just a joke.
Any smart contract with a centralized oracle entity has all of the downsides of centralized money. These are much more convenient as a medium to crypto, but that’s it.