The charm of cryptocurrency: a story about fear, anxiety and fomo
There is a growing phenomenon in the world of finance, which caused investors, traders and even ordinary users felt disturbing and uncertain. He is known as fear of missing (Fomo). But what is behind this psychological trap and how does this affect cryptocurrency prices? In this article, we delve into Fomo psychology and examine its impact on cryptographic markets.
What is Fomo?
Fomo is a common psychological phenomenon that causes individuals to feel disturbing or fear that there is a lack of possibilities. This is often caused by social media platforms, in which users are constantly presented with updates about the successes and failures of others. This creates a sense of anxiety, as if a person watching their friends’ lives could miss an exciting experience.
In the context of cryptocurrency, Fomo takes on a different form. When investors see how other traders or investors earn money on the market, they will probably worry about potential benefits. This anxiety can lead to impulsive decisions, such as buying or selling based on short -term market fluctuations.
Fomo psychology
Several factors contribute to the psychological phenomenon of FOMO:
- Social media : Social media platforms such as Twitter, Reddit and Facebook are breeded for FOMO. Users are constantly bombarded with updates about the successes and failures of others, creating a sense of competition.
- This fear can be tightened by the continuous flow of market messages and updates.
- Anxiety and uncertainty : Cryptocurrency markets are unstable by nature, and prices are variable due to various factors, such as regulatory changes, technological progress and global events.
influence on cryptographic prices
When investors experience Fomo, their emotions can lead them to making impulsive decisions that ultimately cause losses or profits. Here’s how:
- Spontaneous buying or sale : Pulsifiers buyers and sellers can quickly react to market messages, causing a rapid increase in prices.
- speculation and trade : The desire to “get on the ground floor” promising cryptocurrency can lead investors to excessive treatment or performing reckless plants, which ultimately leads to losses.
- Psychological flatworm : Investors may more often make emotional decisions based on short -term market fluctuations, and do not analyze the basic foundations.
examples of FOMO in crypto
To illustrate the influence of FOMO on cryptographic prices, let’s consider several examples:
- Bitcoin (BTC) and Ethereum (ETH) : In January 2020, Bitcoin experienced a huge increase in prices after the fall of global exchange of cryptocurrencies Mt. GOX. Investors who missed this opportunity because of Fomo often regret their decisions.
- Craze Altcoin : Altcoin’s madness at the end of 2017 2018 was partly driven by FOMO. Many investors, willing to get involved in the space of cryptocurrencies, have bought large amounts of tokens without fully understanding their value or risk.
Breaking the FOMO cycle
To avoid the fall of the victim in Fomo and its impact on cryptocurrency prices, it is necessary to develop a more refined understanding of markets. Here are some tips:
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