Crypto crashes are not new. Crypto investors have lost their investments in previous crypto crashes, with some experiencing more significant losses. Imagine waking up to learn that the price of Bitcoin had significantly dropped when you had just invested your hard-earned money in it. That was the reality of many Bitcoin investors in early 2022 when Bitcoin’s value dropped by unimaginable rates. If you have yet to try Bitcoin trading, visit bitcoin up to start investing in this cryptocurrency.
Yet, Bitcoin remains an attractive investment, with millions already buying and holding it. Bitcoin trading platforms are trendy. This website is among the leading Bitcoin trading platforms available today.
So, what is the psychology of Bitcoin investing? Specifically, why do people buy and hold Bitcoin despite the well-known risks? Keep reading to find the answers.
Psychology of Bitcoin Investing
Bitcoin investing has a psychological basis and explanation, but many people still don’t know. Bitcoin investing is just another investment choice or strategy for many investors. There are no classes on the psychology of Bitcoin investing, and anyone with whatever level of education can become a Bitcoin investor.
One needs to look at several factors to understand the psychology of Bitcoin investing. First, Bitcoin investing is still a new and emerging concept. It is not like investing in stocks or forex, which has existed for long periods. As such, knowledge and understanding of Bitcoin investing still need to be improved.
Second, Bitcoin investment is unique because it involves a volatile asset. Bitcoin is a cryptocurrency. Like other cryptocurrencies, the risk of investing in Bitcoin is considerably high. The high price volatility and uncertainty are the main reasons behind this. If you buy Bitcoin today, you rarely know how the price will move tomorrow or a few days later.
Based on these two fundamental factors, the psychology of Bitcoin comprises aspects of culture, uncertainty, and fear. Social media and publicity are also pertinent.
Culture
Bitcoin is a unique culture or subculture. Humans will always want to be part of a culture or subculture because they are social beings. Bitcoin provides such a culture to many crypto enthusiasts. It becomes more appealing to join, yet its characteristics remain unclear.
Joining allows new investors to learn and experience this new culture. It also gives them the satisfaction of belonging to the Bitcoin culture. It is as if one not investing in Bitcoin is an outsider. Therefore, people will want to buy and hold Bitcoin as part of this culture.
Uncertainty
The uncertainty that surrounds Bitcoin creates a strong appeal for investors. This uncertainty drives investors to buy and hold Bitcoin to see what will happen. While most Bitcoin investors hope to get rich through it, they also know there is a possibility of getting poor. Yet, the uncertainty creates a false impression that Bitcoin provides a rare opportunity to become a millionaire or billionaire easily and quickly.
FOMO
FOMO, or fear of missing out, represents part of the psychology of Bitcoin investing, where some investors fear missing out by not investing. Stories of individuals becoming overnight Bitcoin millionaires or optimistic predictions about Bitcoin’s future price are everywhere. These make people feel like they would miss out if they did not buy or hold Bitcoin.
Social Media and Publicity
Social media platforms like Facebook, Twitter, TikTok, and YouTube feature Bitcoin as one of the dominant stories. Some present celebrities using Bitcoin, while others explain ways to invest in cryptocurrency. These stories also strongly influence people to invest in Bitcoin, like their favorite celebrities, or become part of what is trending.
Conclusion
Bitcoin investing is more than a rational investment decision. It features more irrational elements and choices. People are buying and holding Bitcoin to be part of a community or for fear of missing out.
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