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Crypto investors quickly retrofit HODL as an acronym for “hold on for dear life,” an encouragement to other crypto investors not to sell when prices fall. The meme also acknowledges novice crypto investors that they are not skilled enough to profit from short-term trades amid the notoriously volatile crypto market. Bitcoin hodl meaning So why would a typical crypto investor HODL? In addition to a few metrics, HODL differentiates a dedicated investor from one with paper hands (a quick seller).
HODL is more than just a funny crypto meme that’s gained viral attention over the past several years. Over time, it’s become a legitimate crypto philosophy and rallying cry that has impacted how many successful crypto investors and users approach the crypto industry. It’s a rational response that people can take to help protect their investments and hedge against the inherent risks and volatility related to crypto performance. Drawbacks of hodling 2013 was a big year for Bitcoin. The price surged from $15 in January of said year to over $1,100 at the beginning of December, which delivered a return of 7,230%. With a high-volatility nature, the price fell from $716 by 39% to $438 in mid-December.
What exactly does HODL mean? Where does it come from, and why do crypto investors use it? Example of HODL Used in a Text Given how volatile swings are when it comes to cryptocoins, the need to make a decision on HODLING occurs more frequently than with traditional stocks. This is because HODLING is a middle ground where you’re assuming things will work out, instead of putting more money into assets, or selling assets when part of you thinks they could be worth much more tomorrow.
Since this initial misspelling, investors noticed the value that came from holding onto investments for the long-run. Essentially, the mantra that is HODL became an investment technique that actually produced significant returns. Instead of buying the dips and selling the highs, HODLers disregard price swings and hold on to their investments for dear life! This strategy quickly became the favorite tactic of crypto maximalists who don’t want to experience FOMO, or fear of missing out. FOMO will take place when an investor sells a fungible or non fungible token and a price increase follows. The only foolproof way to ensure FOMO does not take place is to HODL according to those who believe the price can only go up with time. What Does HODL Mean? The concept is the same as a long-term buy-and-hold strategy for investing in stocks. If an investor expects a company to perform well in the future, they can hold a stock for years through multiple price swings, believing that it will ultimately gain value over time.
