{"id":158180,"date":"2023-08-26T09:01:22","date_gmt":"2023-08-26T09:01:22","guid":{"rendered":"https:\/\/businessyield.com\/?p=158180"},"modified":"2023-08-26T09:01:24","modified_gmt":"2023-08-26T09:01:24","slug":"what-is-fomo-in-crypto-and-how-to-deal-with-it","status":"publish","type":"post","link":"https:\/\/businessyield.com\/cryptocurrency\/what-is-fomo-in-crypto-and-how-to-deal-with-it\/","title":{"rendered":"What Is FOMO in Crypto and How to Deal with It?","gt_translate_keys":[{"key":"rendered","format":"text"}]},"content":{"rendered":"

FOMO is everywhere. It makes most people make decisions and act in certain ways that they usually wouldn\u2019t consider. This social phenomenon has been around for decades, and it\u2019s still affecting us in many parts of our lives.<\/p>

The crypto market was heavily hit by FOMO, which has made many people lose their investments. It\u2019s no surprise that many investors are against FOMO and are actively advising beginners to fight it<\/a>.<\/p>

What role does FOMO play in the crypto industry? Let\u2019s find out!<\/p>

What\u2019s FOMO?<\/span><\/h2>

FOMO is an acronym for \u201cFear of Missing Out.\u201d It refers to the feeling that other people are living better lives than you because of something they did.<\/p>

In other words, you feel like you\u2019re \u201cmissing out\u201d on something that most other people are doing. <\/p>

Social media has played a huge role in making FOMO more common. Many experts have studied the psychological effects of this phenomenon to come up with a way to fight it, such as the FOMO-R method<\/a>.<\/p>

FOMO is something that can cause a lot of stress, anxiety, and even depression in people. When it comes to the financial market, this is also something that could make you lose money.<\/p>

How Does FOMO Affect the Crypto Market?<\/span><\/h2>

The crypto community is familiar with the FOMO term, but why? Essentially, FOMO encourages people to make irrational investing decisions while trading.<\/p>

A great example of FOMO revolves around Elon Musk and his Dogecoin promotions. Back in 2021, Elon Musk started making subtle tweets about Dogecoin, which was considered a \u201cmeme coin\u201d at the time.<\/p>

That\u2019s all it took to make hundreds of thousands of people invest in this cryptocurrency, making its value skyrocket. If Elon Musk is doing it, why shouldn\u2019t you?<\/p>

The problem is that these situations make people trade without doing research first. An example of this is Glauber Contessoto\u2019s story. He put his life savings into Dogecoin back in February 2021. It was about $188,000.<\/p>

Glauber got about $3 million from his investment, but instead of reinvesting his profits, he decided to keep them. His $3 million went down to about $230,000 in 2022.<\/p>

He claimed that he made his first-ever crypto investment in February 2021, so he barely had any knowledge about what the best move in that situation was.<\/p>

FOMO could make you do something that benefits you in the future, but if you don\u2019t do research and educate yourself, you\u2019re more likely to lose later. That\u2019s why many investors use the BitAI Method<\/a> to increase the ROI of their trading campaigns.<\/p>

What Can You Do to Fight FOMO?<\/span><\/h2>

Unfortunately, it\u2019s not easy to fight FOMO. What you can do is \u201ccontrol\u201d your urge to follow the masses and research people\u2019s claims before deciding anything.<\/p>

There are several ways to avoid FOMO as a crypto trader, including:<\/p>

Create a Plan<\/span><\/h3>

It seems obvious, but having an investment plan and sticking to it allows you to avoid any emotional trading. FOMO is known for stressing out people, and such a strong emotion is hard to avoid.<\/p>

However, if you have a plan, you won\u2019t act on those emotions, helping you keep your money safe.<\/p>

Improve Your Risk Management Strategy<\/span><\/h3>

Risk management is one of the most important things to consider besides your trading plan. <\/p>

Your risk management plan involves identifying and evaluating any financial risks in your trades. This allows you to come up with a good strategy to minimize your losses.<\/p>

It\u2019s impossible to eliminate risks completely, but if you\u2019re able to identify everything that could hurt your results, you\u2019ll do better in your daily trading.<\/p>

Don\u2019t Follow the Hype<\/span><\/h3>

As mentioned before, social media is one of the main culprits regarding crypto FOMO. A lot of people run to invest in an asset when their favorite influencer talks about it.<\/p>

Even if you see a lot of people investing in something because an influencer promoted it, don\u2019t act until you verify the information.<\/p>

You must always invest based on your own research. Relying your strategy on hype will only get you bad results.<\/p>

Understand That You Won\u2019t Always Win<\/span><\/h3>

It\u2019s a tough pill to swallow, but when it comes to crypto, it\u2019s impossible to win all the time. <\/p>

Once you understand that you\u2019ll face losses eventually, you\u2019ll be more grounded. This will allow you to make logical decisions instead of emotional ones.<\/p>

Learn from Your Mistakes<\/span><\/h3>

Even if you fall into the trap of FOMO, don\u2019t worry; we\u2019ve all been there.<\/p>

The best thing you can do is learn from your mistakes. If you lost profits because you invested in crypto after hearing news about it, you now know that you can\u2019t rely on information right away.<\/p>

In any case, you should always double-check the information you get. If you\u2019re logical instead of emotional with your investments, you\u2019re less likely to make a mistake.<\/p>

Bottom Line<\/span><\/h2>

FOMO is hard to fight, but it\u2019s not impossible. As long as you are at peace with the fact that you can\u2019t get rid of it completely, you\u2019ll have a better time controlling it.<\/p>

If you\u2019re struggling with FOMO in any context, take your time to breathe and decide whether you\u2019re truly making a good decision. You can also seek support online; many people are going through the same experience.<\/p>