Psychology of Crypto Investment: Key Terms to Know.

Psychology of Crypto Investment: Key Terms to Know.

FOMO? FUD? HODL? What are these? Read this concise article to get a brief understanding of the basics of crypto investing's psychology.


4 min read

Investing in cryptocurrency can be an exhilarating experience, with the potential for significant gains in a short amount of time. However, the market is also highly volatile, and it can be a rollercoaster ride of emotions for investors. Understanding the psychology behind investing in cryptocurrency is crucial for anyone who wants to navigate the market successfully.

FOMO (Fear of Missing Out)

FOMO is a well-known psychological phenomenon that has been around long before cryptocurrency. It's the feeling of anxiety that arises when we believe that others are experiencing something positive, and we're not. In the world of cryptocurrency, FOMO can lead to investors buying into a coin because they see others profiting from it, even if they don't fully understand the technology or the market.

FOMO can be particularly strong in the cryptocurrency market because of the high potential for returns. When a coin is skyrocketing, investors may feel the urge to buy in, fearing that they'll miss out on a huge opportunity. However, this can be dangerous, as it can lead to rash decisions and investing more than one can afford to lose.

FUD (Fear, Uncertainty, and Doubt)

FUD is another psychological phenomenon that can influence investors in the cryptocurrency market. It refers to the spread of negative rumors or misinformation that can cause people to doubt the value of a coin, leading to panic selling and a drop in the price. FUD can be spread intentionally by those with a vested interest in seeing a particular coin fail, or it can be a natural result of the market's volatility.

FUD can cause investors to make irrational decisions based on fear and uncertainty rather than on sound reasoning. It's essential to stay informed and do research before making any investment decisions. Taking the time to understand the technology behind a coin, as well as the current state of the market, can help investors avoid falling prey to FUD.

HODL (Hold On for Dear Life)

HODLing is a term that originated in a post on the Bitcoin Talk forum in 2013, in which the author misspelled "hold." The term has since become a popular mantra among cryptocurrency investors, referring to the practice of holding onto a coin for the long term, despite market fluctuations.

HODLing can be an effective strategy for investors who believe in the long-term potential of a particular coin. It can also help to avoid the temptation to make emotional decisions based on short-term gains or losses. However, it's important to remember that HODLing is not a one-size-fits-all strategy, and it's essential to understand the risks and potential rewards before making any investment decisions.

BTFD (Buy The F*cking DIP)

This is a strategy that some cryptocurrency investors use to take advantage of short-term price drops in a particular cryptocurrency. When a coin's price experiences a sudden drop, investors who practice BTFD will buy the coin at a lower price, expecting the price to rise again in the future.

The term "f*cking dip" in BTFD refers to a significant drop in a coin's price that may be caused by factors such as market fluctuations, negative news, or panic selling by other investors. By buying the dip, investors hope to profit from the rebound in price that typically follows such drops.


This is a term used in the cryptocurrency and blockchain space that refers to the act of building useful and practical blockchain-based products and services. These products and services utilize smart contracts, which are self-executing contracts with the terms of the agreement directly written into lines of codes, and have the potential to revolutionize various industries by providing greater efficiency, transparency, and security and currently the space that is growing at high-speed is the Web3 space.

BUIDL focuses on building new crypto projects instead of just HODLing them. This means creating blockchain-based solutions that are inclusive, user-friendly, and can benefit everyone, regardless of their background or socioeconomic status.

DYOR (Do Your Own Research)

Do Your Own Research! This is a term commonly used in the cryptocurrency and blockchain space. It refers to the importance of conducting thorough research before making any investment or business decisions in the industry.

Cryptocurrency and blockchain technology can be complex and constantly evolving, and there is often a lot of misinformation and hype surrounding particular coins, projects, and ICOs (Initial Coin Offerings). As such, it's essential for investors, traders, and entrepreneurs to do their own research and due diligence to understand the risks, potential rewards, and the technology behind a particular project or coin. This should be the number one and most crucial term to understand and follow as you should always DYOR!


Investing in cryptocurrency can be an exciting and profitable experience, but it's essential to understand the psychology behind it. FOMO, FUD, and HODLing can all influence investors' decisions and lead to irrational choices. By staying informed, doing research, and keeping emotions in check, investors can make sound decisions that can lead to long-term success in the cryptocurrency market.