Navigating Bitcoin: Control Your FOMO

If you pay attention to financial markets, you may have gotten sucked into last week’s Bitcoin frenzy where it reached an all-time high of $103k. Despite being tempted, I’m not buying.  

For those of you who own and have held Bitcoin for some time, good for you! It takes self-discipline to watch such volatility for so long without making impulsive decisions. For those considering investing in Bitcoin (or any investment, for that matter) now, I challenge you to consider the emotional factors before taking the leap.  

When an investment trend appears to be doing swimmingly, it can be challenging to feel like the only person not “in” on it. FOMO (fear of missing out) is a legit emotion that can result in impulsive and poorly thought-out spending if not recognized. We all experience FOMO. 

I consider it as a personal success that I’ve simultaneously stayed aware of Bitcoin’s quickly rising prices yet refrained from purchasing any. This isn’t a slam on those who own Bitcoin. I’m proud because I know myself well enough to know that it wouldn’t be healthy for me to invest in it. I know I would become addicted to the thrill of trading, getting fixated on watching the market, thereby neglecting other – much more important – aspects of my life.  

My happiness for a significant portion of adulthood was associated with how well my investments were doing because I associated my worth as a human with my net worth. It’s really quite tragic. I’ve spent years breaking down the lies I told myself and replacing them with divine truths. I’m opening up about this because I see clients who struggle with the same thing – hoping to catch an investment wave and ride it until they finally have enough money to … you name it.  

When our worth as humans is defined by how well financial markets are doing, we’re setting ourselves up for severe psychological impacts. Anxiety over potential losses become astronomically overwhelming and we face increased risk of depression. We act out of emotion instead of rationality, tending to make fear-driven decisions. We experience a perceived loss of autonomy which can feel like loss, loneliness, and hopelessness when things aren’t performing as we’d hoped. 

Bitcoin is volatile. A mere seven hours after hitting its high on 12/4/24, it lost 9% of its value. A short-time high, indeed.  

If you are an investor and find yourself tempted to act on the market hype, or if you too associate your success as a human with how well you’re doing financially, I encourage you to develop increased emotional awareness so you can approach investing with a clear mind and well-thought-out plan, rather than making emotionally driven decisions.