What is Crypto FOMO and how to avoid it?

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The year 2022 has gotten significantly worse for investors of all kinds. After a period of accommodative monetary policy by the Federal Reserve, interest rates were raised to fight inflation. The best axes are (so far) for risky assets like cryptocurrencies and high-growth stocks.

The question is, how can investors avoid FOMO when it eventually returns? And what is FOMO? Here’s what you need to know.

What is FOMO?

FOMO means “Fear of getting lost”. It is a symptom of anxiety that often occurs when others are having fun (or talking about having fun). In the cryptocurrency industry, many investors had FOMO in 2020 and 2021 when the prices of many cryptocurrencies were skyrocketing. These beliefs have been reinforced by people’s frequent posts on social media touting the incredible returns on investments that change the life of buying the right cryptocurrency or digital asset (like NFTs) at the right time.

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FOMO in cryptocurrencies and investments explained

People are prone to social outbursts. In the right dose, FOMO is a healthy trigger, stimulating us to seek friendships or motivating us to seek new experiences.

But FOMO can show up in a variety of situations where it’s not that good. Investments are part of it. For a short time, the markets were ruled by two basic human instincts: fear and greed.

Often, watching other people get rich quick, especially when advertised on social media or among peers, can lead to moral choices. FOMO can lead some investors to follow the crowd into a popular cryptocurrency project or other high-growth investment without fully understanding the risks involved. But fashions are the order of the day in the world of Nalobs. What is created in the moment can quickly crumble and FOMO (driven by collective greed) can go from fear of missing out on fun to fear of losing hard earned money.

The thorny upheaval of 2022 is proof of this: many cryptocurrency investments, some very successful, have lost the support of early adopters and latecomers have been stunned by the sharp drop in prices.

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How to avoid FOMO

Fear and greed move markets (stocks, cryptocurrencies, etc.) in the short term and trying to chase the current excitement can lead to disaster. But overcoming our basic human desires is easier said than done. Here are the training paths to avoid repressed FOMO in the next bull market.

  1. Keep in mind that investments are long-term.
  2. Focus on your goals, not just money
  3. Create a portfolio, not a collection of helpful tips.
  4. Everyone has an agenda and rarely have your best interests at heart.
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