How much of a crypto enthusiast are you? Have you tried asking yourself what would you do if crypto prices just plunged all the way down like shit?
I just came across a Thailand-based crypto group on Facebook and it seems like quite a number of them made a big mistake, most of them bought crypto at sky-high prices. And what's worst is that most of them won't just it slowly and just sell off their cryptos to cut lost which to me, is more like quenching thirst with poison. They didn't cut their losses with that action of selling it, they just acquire more losses selling all of them (Some even lose millions of Thai baht).
I believe the reason for their actions is something we call, "emotions". Even at the start when they bought their cryptos at a sky-high price, then to the action of clearing off their portfolio out of fright and fear because of the price dumps. It all points to the fact that they are using emotions to decide the majority of their actions, which in turn leads to the deterioration of the whole situation when circumstances got worse because they start infusing more emotions into solving problems, which then lead to everything going haywire.
Emotional Hodlers/Traders
Most of them are hot-tempered and tend to use emotions in solving problems even in daily activities. They tend to be greedy and cautious at the wrong time because they let their emotions control them. An example would be a cryptograph is on an upward trend to a new all-time high, their next course of action would be to buy the upward trend, believing that it'll go up more and more (they'll react even more if someone goads them on). Then the price goes down and stabilizes, they go and sell all of it out of fear, resulting in loss from their sky-high price bought crypto(even though some of them even read Warren Buffet's books and came across many of his quotes, "Be greedy when others are afraid and be afraid when others are greedy.")
The cons of emotional people
- They are quite hot-tempered and tends to overreact
- They tend to lose their cool as easily as picking up a spoon
- They tend to be over-cautious at the wrong time
But the only pros I can feel from them is that they are a bunch of sincere people(the majority of them).
Rational Crypto Hodlers/Traders
These are the people who mostly use reasoning to solve daily problems, decide things based on analyzing the situation, and think of a win-win solution if possible. They are the kind to know and fully understand that only by buying low and selling high will they be able to profit from their actions. They don't follow trends and buy when it's at their peak. They either be patient and keep their fund for the dip or they do DCA (Dollar Cost Average).
- DCA-ing is when you deposit and buy a substantial amount of crypto every week or month with the same amount of money(or even more if you want) consistently.
Pros of the rational people
- They use reasoning to solve problems and make daily decisions
- They analyze situations accordingly and carefully
- They consider the pros and cons of each of their actions
- They don't procrastinate when actions are needed, and they can be more patient than anyone else when patience is needed.
Conclusion
For the time being, I think the correct way to decide things would be to be a rational person, but I feel as though when treating people, we should be more emotional and sincere in our approach. So I'll say we should all have total control of our own minds and decide how we want to be and when we want to be rational or emotional. It shouldn't have control over us, we are the master of our own mind, isn't it?
These are just my personal opinions, not my teaching or advising you guys. Only treat it as a reference to help in your daily decision.
And yeah, thanks for reading it till the end, and feel free to comment or criticize as you deem fit.
I'll accept all of them with grace and work to improve myself.