Are you a HODLER or Seller?

As a consequence of crypto growth, there are some terminologies that have a level of spontaneity - and here are some perfect examples

Metamorphosis is not just a term to describe animals and plants. The term depicts a more diverse space of events. 

Just as Humans evolve from a baby to a young kid and then to an adult, the same can be said about blockchain technology and crypto currency as it has been proven that there is a continuous metamorphosis of the activities in the blockchain technology and cryptocurrencies’ space.

Some people came into the blockchain and crypto ecosystem for the purpose of understanding the technology, while others basically came for the purpose of having financial gains no matter what happens.

In that way, the entire crypto space is evolving every day and we don't expect it to stop evolving.  

And, as a consequence of this growth, there are some terminologies that have a level of spontaneity and a perfect one is the term HODLER.

Who (or what) is a Hodler?

HODLers are crypto investors who buy and hold their positions regardless of price. 

They shun trading based on short-term price moves - whether the market is up, down or sideways, these traders stay invested, confident in the long-term value of the crypto project. 

The term HODLing was created in 2013 in a Bitcoin chat forum by an investor who was watching Bitcoin’s price fall sharply but decided not to sell. 

He wrote a post titled, “I am HODLing,” meaning to write “HOLDing.”

And then the term “Hodler” was born. 

Hodlers wash their hands of all this volatility and analysis from the market movement usually associated with charts and market news. 

They simply ‘hodl’, which helps them to counteract two common destructive tendencies: FOMO (fear of missing out), which can lead to buying high, and FUD (fear, uncertainty, and doubt), which can lead to selling low. The latter is occasionally referred to as SODLing. 

The misspelling caught on with the Bitcoin community. 

Eventually, working backwards, they turned it into an evocative acronym: Hold On for Dear Life. 

Anyone who has watched Bitcoin’s recent volatility knows that the acronym can sometimes feel spot-on.

HODLers get dismissed by traditional investors as unrealistic crypto maniacs who buy and hold regardless of price. But buying and holding seems like a rational approach in an asset as volatile as cryptocurrencies, where trying to time the market is nearly impossible.

Still, HODLers can’t just sit idle: To maximize their risk-adjusted returns and maintain a reasonable portfolio, they need to systematically rebalance their portfolio over time. 

The rebalancing function forces investors to sell high and buy low, keeping portfolio allocations in check.

Who is a Seller?

Remember when you bought your first cryptocurrencies? 

Or perhaps you are thinking about it? 

You would spend your US dollars, Euros or other fiat currencies to get yourself your very first Bitcoin (or other crypto of choice). 

Sure enough, buying crypto with money is a common entry point into the world of cryptocurrencies and when you need to recoup your investment in fiat, then you do the opposite of buying and engage in the selling of your cryptocurrencies back to fiat. 

This will obviously make the individual a seller. 

As with all investments, having a disciplined, rules-based approach is important and applicable  in crypto. 

This is the reason we encourage everyone to spend some time to learn the rudiments of crypto by latching on to the educational contents being churned out by the Klever team, most definitely putting the freedom of understanding the basics of crypto trading and investing.

It is indeed a Klever thing to do.

James Enajite
Klever Writer

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