Even if you haven’t participated much in the cryptocurrency realm over the past several years, you’ve probably seen some of the memorable crypto memes that have become viral web sensations. HODL just so happens to be one such meme you’re likely to have come into contact with over the past decade. But what does HODL mean in terms of crypto? Is it more than just another humorous crypto meme without any substance? And how could it play a role in your crypto philosophies going forward?
Our team of financial experts and professionals at unBanked are here to explain the answers to these questions and explore the history of HODL in the cryptocurrency realm. Please continue for more information and to learn whether or not HODL is a concept you may want to incorporate in your approach to crypto.
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The HODLING Backstory: What is it, and Why Does it Matter?
We could go into extensive detail regarding the strange history of HODL. However, to keep things simple, all you need to know is that the term is a shortened version of a 2013 post heading on an online forum featuring a misspelling that’s since become relatively legendary online; “I AM HODLING.”
This statement came alongside a drunken, semi-coherent, typo-ridden rant in which a crypto investor explains his poor crypto-trading skills and his new determination to hold onto his Bitcoin from that point forward. This user’s decision is based on the idea that keeping your crypto is the best course of action since people only sell in a bear market if they’re a “good day trader” or an “illusioned noob.” The people in between should hold their crypto because “in a zero-sum game” such as crypto-trading, “traders can only take your money if you sell.”
The original poster then explained that he had some whiskey before writing his post and briefly mused on the spelling of the word whiskey. Within an hour, HODL had become a viral internet meme.
HODL: Now An Inpromptue Acronym for Crypto Holding
Alongside its emergence as a famous online meme, HODL- essentially a mangling of the word “hold”- has since become an acronym for the phrase “Hold On for Dear Life.” The concept encourages crypto investors to hold onto their cryptocurrency for the long term rather than the short term. But while this idea may seem humorous when taken at face value as nothing more than a meme, it has a good deal of historical market for investors, especially for things like stock market investing.
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HODL: A Crypto Strategy and Philosophy
Patience is a crucial element for many successful investors, especially concerning cryptocurrency. The market is highly volatile compared to other investment markets, so investors need a considerable amount of patience to hold firm and keep their investments in place to avoid pulling out at the first sign of a market drop. For example, if an individual invested $1,000 in Bitcoin on the day the original HODL post was released, their investment would be worth nearly $63,000 today in 2022. However, many people have lost considerable amounts on their Bitcoin investments because they decided to sell their coins and bail out after temporary market falls.
Because of this, HODL has become a significant part of many people’s investment strategies regarding crypto. However, investors should remember that it’s essential to have a plan and articulate goals for their investments since the utility of the HODLing technique does have its limits.
Related: Crypto Isn’t Just a Currenc, It is a Wealth-Generating Investment
Is HODL The Right Decision for You?
The HODLing strategy has become a significant element in many people’s approaches to crypto investing and has helped several people reap the benefits of substantial long-term gains. That said, it’s essential not to take the concept too far, as it’s not risk-free to keep your investments forever without eventually cashing them in. While HODLing can be a helpful default for many investors, it’s also essential that they have a specific investment plan and a series of goals established to help them move forward to collect any gains they may have produced someday.
It’s essential to find a crypto investment and holding strategy that works well for your unique risk and volatility tolerance level. But you also need to utilize discipline to sometimes refrain from pulling out your assets at the sign of a market drop because you’re afraid of losing your investment. It’s all about developing a balanced strategy that meets your specific needs.
Related: Can NFTs Be The Next Big Thing After Bitcoin?
Final Thoughts to HODL Onto
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.
Our experts at unBanked sincerely hope that the above information has helped explain the concept sufficiently and allowed you to determine whether it could be helpful when applied to your crypto approach in the future. For access to more information on all things crypto, please consider exploring our wide array of services and reading through some of our other expertly written cryptocurrency resources.
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