Buying Bitcoin can be a mammoth of a task. Not only does it often require complex KYC (know your customer) processes, the entire buying Bitcoin ‘service’ can be slow, expensive and a little frustrating. What makes this worse, is the lengthy dictionary of jargon that seems to follow the Bitcoin buying ‘culture’ is very confusing. It’s full of words, phrases and terminology that can distract even the most attuned Bitcoin buyer.
In order to make the process a little easier for you, we are going to break down some of the jargon and let you know exactly what it all means.
More commonly known as ‘Hold’, HODL is a crypto-word that stems from a typing error of the world hold. This simply refers to holding on to your Bitcoin through periods of volatility with the view that at the end of it all, your Bitcoin investment will be far more valuable than it was at the start. According to Retail Crowd:
“HODLers believe in Bitcoin’s underlying quest to free the world from a corrupt and nefarious financial system. Additionally, they believe that Bitcoin will always see a rise in value in the long term. Considering that there is fewer than four million Bitcoin left to be mined, the scarcity of this digital asset is undeniable.”
If you’re buying Bitcoin and want to be in it for a long run, you’re a HODLer.
This is what it says on the tin. Day trading is when investors are involved in trading Bitcoin (and other cryptocurrencies) on a daily basis, making the most of volatile price movements to make a short profit. This isn’t for the faint hearted, as day trading usually requires advanced market analysis techniques. In sort, to day trade successfully, you really need to know what you’re doing.
Fear, uncertainty and doubt. FUD is a term used to describe speculation that seems to have been designed to inject fear into investors, in order to encourage them to buy or sell relentlessly. FUD is generally associated with falling price values.
Fear of Missing Out - self explanatory really. If you’re reading this and wondering if you’re going to miss an opportunity by not buying Bitcoin, then you my friend, are experiencing FOMO.
‘The Truth About the Dip’
This is one of those terms that is very loosely thrown around by analysts within the cryptosphere. What it actually refers to is the buy low and sell high strategy. According to Retail Crowd:
“This is the investment axiom that is echoed by experts throughout the crypto space. While it seems easy enough, predicting when the dip is at its lowest point is tricky, to say the least. One of the best strategies is to review the market charts and if the dip is near resistance lines, buy. Resistance lines on a market chart represent points in which the market showed an increase in buying activity, thereby stopping the bear.”
There you have it, now you’re a fully tuned investor!
The idea of this article is to give you a bit more background knowledge to help you carry out further reading and further research, without being distracted by the jargon that tries so hard to throw you off the scent of Bitcoin. Remember, if you do decide to invest, you should do so based on your own prior research. Only invest what you can afford to lose and remember that Bitcoin and cryptocurrency investment is risky, therefore, always be sure you are trading safely.