If you are not aware of this, you cannot be a true Bitcoin HODLer.
I share my opinion, and I try to provide you analysis that will make you want to know more and more about Bitcoin, money, and the economy in general. As you may have noticed, I am a supporter of the Bitcoin HODLing strategy.
I didn’t invent anything, and all Bitcoiners practice this strategy of holding the Bitcoins they buy no matter what.
This strategy is not random. It is based first of all on a fundamental trust in the Bitcoin revolution, but also in metrics. As you know, Bitcoin teaches you to develop your critical thinking skills.
Being a Bitcoin HODLer is pure pragmatism
So, before becoming a Bitcoin HODLer, I invite you to look at the number of days during which the Bitcoin HODLing strategy has been profitable. If you do this, you will find that HODLing Bitcoin has been a profitable strategy nearly 93% of the time since its inception.
Then, you will only have to take a quick look at the Bitcoin price evolution since 2010 to understand that Bitcoin is only increasing overall :
This chart of Bitcoin price evolution shows you the advantages of being a Bitcoin HODLER rather than a Bitcoin Trader.
This will give you an essential advantage since it will allow you to be much more Zen with the fiat money you exchange for Bitcoin.
Knowing this, however, is not enough to become a true Bitcoin HODLer.
Even though you know that HODLing Bitcoin is a profitable strategy more than 90% of the time, and that Bitcoin price keeps increasing over time, you still won’t be ready to face the storm when it comes.
In fact, if the Bitcoin price is constantly increasing when you look at it over a long period of time, you should know that Bitcoin remains an extremely volatile market.
Bitcoin’s volatility is a feature, not a bug.
This volatility of Bitcoin can be your best ally, or your worst enemy. It will all depend on how well you are able to control your emotions. The real secret that no one tells you before you become a Bitcoin HODLer is that it won’t be a long, quiet road as some people imagine.
When HODLing Bitcoin, there’s a big difference between theory and practice
Many people imagine that being a Bitcoin HODLer means buying Bitcoin, then securing it on a hardware wallet, before waiting to become a millionaire in a few years.
Here’s the image that many have in mind:
As always here, it’s all about theory. You know as well as I do that there is a huge difference in life between theory and practice.
In practice, HODLing Bitcoin is not a quiet road to wealth with a Bitcoin that will be worth $1 million in some years.
Patience is essential to be a true Bitcoin HODLer, but it is only one of the qualities you will need to demonstrate along the way.
In reality, HODLing Bitcoin is more like a bumpy road where your emotions will be put to the test.
Here’s a much more realistic image that anyone who wants to become a Bitcoin HODLer should have in mind before getting started:
If you are already used to the world of traditional finance, you know that controlling emotions makes a huge difference when it comes to investing. Those who know how to make decisions with their sense of logical reasoning get much better results than those who let their emotions take over.
It’s a long way before Bitcoin be worth a million dollar, but that’s the beauty of it for me.
You will have to demonstrate that you have complete confidence in Bitcoin. Your belief in Bitcoin will be tested frequently. You will see that there are many temptations to stray.
A lot of beginners waste valuable time, and especially money, in Sh*tcoins. Wishing to believe that a new cryptocurrency will be able to perform as well as Bitcoin did in the last decade, some people will let their greed take over.
People who want to believe in the existence of a next Bitcoin are the ones most likely to be tricked by Sh*tcoins’ marketing teams.
What you need to understand is that these Sh*tcoins teams have only one goal in mind: to make the most money. They are ready to promise you all kinds of things in their white papers.
But in reality, utility of 99% of the cryptocurrencies on the market is non-existent. These Sh*tcoins will see their price drop towards zero in the future. Those who blindly believe in a self-proclaimed next Bitcoin will lose a lot of money.
After wasting time and money, people disappointed by Sh*tcoins understand that searching for the next Bitcoin is as useless as searching for the next Internet.
Bitcoin is much more than a cryptocurrency. Bitcoin is the money protocol for the Internet. It’s here to stay, and even though it has shortcomings just like the Internet, thousands of highly talented developers are working on fixing them day after day.
So the future belongs to Bitcoin.
Psychological warfare of FOMO and FUD feelings
FOMO (Fear of Missing Out) and FUD (Fear, Uncertainty, and Doubt) feelings are not specific to the cryptocurrency world. In the world of traditional finance, these feelings also exist.
They develop in humans in a natural way.
Those who make successful investments learn to resist these feelings. When Bitcoin price skyrockets in a few days, many end up buying Bitcoin without even understanding what Bitcoin is.
Thus, when its price drops again rapidly, as it did on Black Thursday in March 2020, these people sell all their Bitcoin at a loss if they have to.
Bitcoin’s volatility is the worst enemy of those who are not in control of their emotions, and who do not have a fundamental belief in Bitcoin.
Bitcoiners who fully believe in the Bitcoin revolution do not get trapped by FOMO or FUD feelings. They buy Bitcoin no matter what happens with a DCA (Dollar-Cost Averaging) strategy.
DCA consists of buying Bitcoin on a regular basis regardless of its price in order to smooth out its costs.
Of course, when Bitcoin price drops to $3,800 as it did in March 2020, Bitcoiners take the opportunity to accumulate more Bitcoin. In this sense, they instinctively follow this investment principle of Warren Buffett:
“Be Fearful When Others Are Greedy and Greedy When Others Are Fearful.”
— Warren Buffett
Warren Buffett may be one of the fiercest opponents of Bitcoin, which he calls “Rat Poison Squared”, but his success in the financial world for over 50 years is impressive.
So it makes sense to draw inspiration from some of his ideas.
This is what Bitcoin teaches us: “Don’ Trust, Verify”. Then, when faced with the facts, you have to be pragmatic.
Bitcoin Whales’ price manipulations
In the Bitcoin world, people who own a very large amount of Bitcoins are called Whales. The large amount of BTC they own allows them to manipulate Bitcoin price in the short term.
As a result, Bitcoin price can experience pump and dump movements that last only a few hours.
The last example that comes to mind was on June 2, 2020:
Bitcoin price went from $9,500 to $10,200 in less than 3 hours.
Many people started to get excited thinking, as they often do, that we would never see Bitcoin again with a price below $10,000. A little FOMO feeling was even starting to develop on social networks.
And then after a dozen hours in the $10,100 — $10,200 range, Bitcoin price dropped sharply back to $9,500 in just one hour.
These manipulative moves by Whales are common in the Bitcoin world. If you want to succeed in being a true Bitcoin HODLer, you must learn not to panic in the face of Bitcoin’s volatility.
Be in control of your emotions, and focus on Bitcoin’s fundamentals. They are excellent, and that’s what should give you confidence.
By taking the long view, you’ll be able to protect yourself from these Whales manipulations.
Sell too early when Bitcoin price reaches $30,000
Bitcoin has tremendous potential for the years to come. It is a real alternative to the current monetary and financial system. Bitcoin will enable the financial inclusion of hundreds of millions of people around the world.
Bitcoin price will rise sharply in the future. Seeing Bitcoin one day reach $1 million is no longer as utopian in 2020 as it was in 2013.
In order to avoid eternal regret, you need to be strong and remain a Bitcoin HODLer when Bitcoin reaches $30,000, or even $100,000, during its next Bull Market in 2021.
The cypherpunks and Bitcoin innovators who sold at the end of 2013 the many Bitcoins they got almost for free in 2010 are probably still regretting it.
They had already made a huge profit since Bitcoin had gone from less than a dollar to just over $1,000 by December 2013.
Nevertheless, selling your Bitcoins too early is something I think you will always regret. Be patient, and remember that Bitcoin has incredible potential for the future.
When someone asks me how long I plan to HODL Bitcoin, my answer is clear:
Bitcoin HODLer one day, Bitcoin HODLer forever.
This gives you an idea of how much confidence I have in Bitcoin, and how long I am willing to hodl them. When you fundamentally believe in the Bitcoin revolution, you measure how lucky you are to own some Bitcoins.
Owning at least 1 BTC will make you a very rich person in the future.
I am convinced that HODLing Bitcoin is the best strategy to enjoy Bitcoin with confidence. However, before you are able to become a true Bitcoin HODLer, you will have to overcome a number of pitfalls.
If you choose to become a Bitcoin HODLer without knowing the real secret I just revealed to you, I am willing to bet that you will give up as soon as Bitcoin price drops sharply for the first time.
So before you get into Bitcoin, you need to understand why Bitcoin was created, and the issues Bitcoin addresses. Once you have real confidence in Bitcoin, you will be able to fully control your emotions.
You will be ready to avoid the pitfalls that frequently present themselves on the way of each Bitcoin HODLer. You will be able to enjoy the incredible road ahead of you, which will lead you to a Bitcoin worth $1 million.