The Psychology of Buying Cryptocurrencies with DailyCoin – News Couple

The Psychology of Buying Cryptocurrencies with DailyCoin

The psychology of buying cryptocurrency

  • Cryptocurrency investments have the allure of a profitable get-rich-quick scheme.
  • All types of buyers have access to cryptocurrencies, regardless of their societal or capital value.
  • Investors always seek the upside of cryptocurrency, while completely ignoring its downside – volatility.

Everything that holds value is worth considering. “In investing, what is comfortable is rarely profitable,” said Robert Arnott, investing in cryptocurrency is somewhat comfortable, but no one in the cryptocurrency space gets rich that easily. However, this is one of the main perks of the industry; Cryptography is easy, and quickly accessible, but not everyone has the knowledge and understanding to fully understand it. If that’s the case, why would they buy it?

To raise prices

Cryptography is its form of culture. Belonging to a trading/investing subculture encourages social reinforcement as all investors strive towards a similar financial goal. In the “Psychology of Cryptocurrency Trading,” buying cryptocurrencies is great for both inexperienced traders and individual traders seeking confirmation on platforms like Reddit.

Dan Lammer, a former chief technology officer of CTO, calls people from developed countries who invest in, and who also use it as anything other than a store of value and speculative vehicle, “people with a reason,” and ranks them as early adopters who eventually want crypto to succeed. . Interestingly, the cult-like allure of cryptocurrencies is what drives most of the retail mania. However, Hee-Jin Kim, a researcher at Chung-Ang University Hospital in South Korea, found that personality traits and psychological states ultimately influence crypto-purchasing decisions.

Moreover, while psychological states influence our basic buying requirements, Peter Eaton, from University College London, explained that people often follow a so-called “herd mentality”, arguing that “people are more willing to share”, as crypto has become more common. Although an individual’s state of mind influences buying behaviors, external stimuli, including influencers and exposure to certain news and environments, such as “crypto Twitter (NYSE:”), increase crypto affinity.

on the flip side

  • Memecoins, NFTs, and shallow ICOs are the reason influencers influence investor decisions.
  • Cryptocurrencies like ChainLink have categorical utility and value within their own ecosystems.

Thus, we are accustomed to coding, to an extent, because more participants reinforce the same narrative, somewhat legitimizing its existence. Ekua Hagen writes that beginners who enter the space outside of FOMO are seeking financial compensation of up to 3x in Bitcoin. She also points out that there is a difference in the buying logic depending on age, with one research indicating that only 16% of users fully understand cryptocurrency. Thus it can be understood that the underlying motives are mostly driven by profits, apart from usability.

We are socially affected animals.

Benedetto Di Martino, a researcher at Royal Holloway, University of London, has highlighted how our brain’s receptors, which help assess danger and risk, can act against us. His research was mainly directed towards the bubble market, which can be somewhat comparable to the cryptocurrency market of 2017.

Di Martino’s study reflects what the media consensus already claims. Crypto retains value as long as other people are willing to pay more. Bitcoin is specifically a store of value, and people buy it and then sell it to make a profit at a future date, depending on market volatility. To this end, the psychology of buying in cryptocurrency is simply the “bigger fools theory.”

Kevin Callen argues that most cryptocurrency and cryptocurrency startups are in part “cryptocurrency loyalty programs,” because they promise a great deal of anti-centralization effects and relate to decentralized extremists.

Why should you care?

Cryptocurrencies have the stigma of being overvalued and showing no intrinsic value outside their niche. However, people who invest in cryptocurrencies and understand the underlying technology are not investing because of the hype. What is important is that every investment is made with proper and thorough due diligence.

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