The million-dollar question in every crypto investor’s mind is ‘to HODL or not to HODL.’ Social media is plush with terms such as ‘HODL’ and ‘diamond hands,’ making it seem like those who sell their cryptos are losers. Influencers guilt trip crypto investors for ‘selling’ their holdings for a profit, calling them ‘paper hands.’ The words are now so ingrained into investors’ minds that they feel selling their cryptos is an eternal sin. Therefore, profit or loss, investors feel the pressure to hold on to their assets because ‘Twitter said so.’
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Also, while Bitcoin came crashing down last month to $20,000 dragging all coins down with it, tweets about ‘I’m HODLing’ and ‘proud paper hands’ was splattered on the platform. This gives an impression to investors that nobody is selling and must hold on to their assets even during a downturn; it doesn’t matter if it’s profit or loss.
Therefore, this type of ‘HODL’ culture is stunting the thinking capacity of retail investors. The choice and freedom of personal financial decision-making are highjacked by the ‘HODL’ gang, eventually making everyone poor. Investors who rode the 2020 crypto boom generating good profits didn’t sell due to the ‘HODL’ gang are now at a loss. The current market loss is dramatic and might take months or even years to recover to its previous glory.
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How to Overcome the Crypto ‘HODL’ Culture Mindset
Booking profits is never seen as foolishness in the stock markets but is considered blasphemy in the crypto market. Thanks to the uncanny string of crypto influencers who promote the ‘HODL’ culture daily. Their service hurts retail investors who never booked a profit despite entering the crypto market to make money.
“Don’t risk your lifestyle because of a HODL meme. No one went broke taking a profit,” said Tyler Reynolds, a Web3 investor to CoinDesk.
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Investors must understand that ‘taking a profit’ means making money out of your investments and not exiting from the crypto market entirely. You decide when to sell or hold on to your assets, and don’t let some random user on Twitter dictate your financial choices.
Keep in mind that the only hand considered superior is the hand that feeds you and your family. Not ‘diamond hands’ and ‘paper hands,’ as the phrase is irrelevant in real life.