The Danger of Crypto FOMO

A majority of the people who enter the cryptocurrency market are searching for one thing. They’re hoping to make it big and never worry about money again. Being able to no longer live paycheck to paycheck. Finally paying off your student loans and debts. Having a clean slate, and having the luxury to have hope for your future again. This is the dream that the cryptocurrency market presents to us.

But that is also its greatest problem.

After all, we have all heard stories about how crypto will cause the largest transfer of wealth the world has ever seen. That Bitcoin will someday be worth several millions of dollars. That Ethereum will rise to several tens of thousands of dollars. Experts claim that we are still very early in the lifespan of crypto and that we haven’t even begun to be able to imagine its full potential.

This is enough to make nearly anyone excited. But there is more thing that crypto experts say that causes many of us in the market to make our biggest mistake. When talking about how early we are in the lifespan of crypto, they will say that we are somewhere comparable to where the internet was in the late 1990s. Right before the internet became what we know it today.

They tell us that this is a once-in-a-lifetime opportunity where retail buyers actually have the chance to get into the market that will be the “next big thing” before the big players enter. Not only that, but the majority of people haven’t even woken up to how important Bitcoin is, and the value it has. This amazing Bitcoin secret of us will not last forever. In fact, the secret is already getting let out of the bag. The adoption of Bitcoin has increased slowly over the years, but it is getting to a point where it will begin happening suddenly.

For those of us in the cryptocurrency market, this thought alone causes us to feel extreme FOMO. That we need to accumulate as much Bitcoin as possible before the world wakes up to just how important it is. Also that this could be our last opportunity to accumulate at these price levels.

If you have researched the market and built a strong conviction in Bitcoin; these types of reactions and thoughts may seem normal.

However, things become much riskier during bull markets. When the market is going parabolic; there will be days when Bitcoin soars by 10%, 20%, or more. And keep doing it several days in a row. That causes our extra sense of FOMO to kick in. Our thoughts about Bitcoin eventually taking over were all true, and it will soon be reaching a price of millions of dollars per coin. We then succumb to our emotions and pour irresponsible amounts of money into the market while it is pumping.

Naturally, soon after the market calms down, and even sees a large pullback. Our FOMO and moment of weakness caused us to invest more money than we should have into an asset that had reached its local top. Always remember that when the market starts to give you feelings of euphoria. We have usually reached the local top. FOMOing into crypto assets begins to feel even more painful while we are in the bear market. People will remember how they paid $250 for one Solana coin, but it could be bought for less than $15 during the bear market.

It can be hard to control your emotions when FOMO begins to kick in. The only thing you can do is try to put in the work before the bull cycles start. Remember that we built our positions during the bear market so that we could enjoy their appreciation during the bull cycle. Above all, never invest more than you can afford to lose. Even if you think the asset you want to buy is a sure thing. In the cryptocurrency market, there are no guarantees.

What goes up, can come down. And what seems like the next big thing, can go to zero.

How about you? Do you ever FOMO into crypto?

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As always, thank you for reading!