The Shocking Truth Behind Emotional Crypto Trading Habits
When it comes to investing, it’s better to make logical decisions than emotional ones. Getting caught up in momentum, recent losses, and media headlines can lead to bad decisions that hurt a crypto investor’s long-term returns.
Unfortunately, most investors let their emotions take the wheel when they’re trading cryptocurrencies. A ChainPlay survey found that 92% of crypto investors make emotional buying decisions.
What Drives Emotional Crypto InvestingIt’s a troubling sign for investors who want to generate long-term returns with crypto. A few catalysts lead to emotional investing. And investors also have several ways to control their emotions.
The ChainPlay survey didn’t just reveal that many people let their emotions guide their investments. The survey also highlighted the five most common emotional triggers among investors.
Rapid price surges were the top emotional trigger, affecting 31% of investors. Trading volume spikes and media coverage were the next two, at 21.7% and 14.6%, respectively.
The fastest way to mentally and emotionally destroy yourself in this crypto-space is to emotionally attach yourself to a coin and make it part of your identity
It does not matter if this is bitcoin, altcoins, memes, whatever, there is a reason that excessive emotional attachment…
Social media hype and new token launches rounded out the list, impacting 13% and 11.7% of investors, respectively.
High volatility or the thought of significant price movements in the future seems to drive crypto investors’ emotions. Getting emotionally invested in a crypto can cause investors to hold on to an asset for too long or exit it too early.
While stock investors also make emotional trades, crypto investors may be more susceptible since their assets trade 24/7.
Stock investors can’t make trades over the weekend, which gives them time to reset some of their emotions instead of making bad decisions.
On the other hand, the crypto markets are never asleep, always presenting investors with social media hype and volatility that they can act upon.
Every crypto bro I’ve met has some gut wrenching love story in their past.
Yet somehow, they all made it big in crypto.
Turns out heartbreak builds the best portfolios.
If you haven’t been winning, pivot to getting your heart broken.
Loudio