The FOMO And ETFs Only Make Bitcoin’s Price Go Higher

Gold and silver round coins photo – Free Money Image on Unsplash 

The undisputed number one cryptocurrency, Bitcoin, touched a new all-time high for the first time in two years before experiencing a temporary decline, trading near $67,000. Bitcoin crossed the $ 69,000-mark, winning people over. The present-day bullish sentiment comes from the wave of investor optimism for a new financial product linked to the digital asset. In January, the SEC authorized a number of cryptocurrency companies and traditional finance firms to supply ETFs that track Bitcoin’s price. Traditional investors, who were once sitting out, are venturing out in full force as the main drivers of capital in the cryptocurrency bull market. They can simply buy Bitcoin from one of the spot markets. 

The price of Satoshi Nakamoto’s creation crossed the highest price point in its 15-year history. Bitcoin is on an upward trajectory, slowly but surely climbing higher since the U.S. gave the green light to spot ETFs; the current daily demand for Bitcoin exceeds new issuance. Bitcoin’s imminent halving event will magnify the supply/demand dynamic, helping continue the digital asset’s strong year. Indeed, Bitcoin seems to be in the midst of a bull run that will replace the crypto winter, but there’s no way of knowing for sure how high the cryptocurrency will go before seeing another correction. 

FOMO Creeps in As Institutional Investors March into The Cryptocurrency Market 

Institutional investors have taken a more active interest in the cryptocurrency sector in 2024. Professional entities that invest large sums of money seek to diversify their portfolios by including Bitcoin, an alternative asset class that can generate substantial returns and reduce overall risk. Many clients have expressed their interest in Bitcoin (and other cryptocurrencies), which produces gains that the stock market can’t rival. Traditional stores of value aren’t easily accessible, and neither are they easy to store, transfer, or dispose of. By contrast, Bitcoin is safely stored via private wallets (mobile apps or desktop software). 

FOMO (Fear of Missing Out) refers to the sense of urgency to acquire Bitcoin when everyone else is talking about it. The idea is to catch the next big move, knowing how much money previous investors have made. Traders end up buying Bitcoin at its all-time price because it’s performing well and don’t want to miss out on the opportunity to make substantial profits. These days, there’s a lot of social media hype and online speculation about Bitcoin’s price movements, which would hit $100,000 by the end of the year. Needless to say, information is a crucial driver of growth in the cryptocurrency market, but it can also drive FOMO, which can be detrimental. 

Some Tips on How to Deal with FOMO And Avoid Risky Trading Decisions 

Bitcoin has logged a gain of approximately 50% in 2024 so far, and the rally may only be gaining momentum. When the cryptocurrency’s price rises, it leads to FOMO, that is, the apprehension or anxiety that individuals feel when others are making profitable trades or leveraging important opportunities in the market. FOMO can lead to financial decisions that you may regret later, as they’re based on emotions, not logic. The question now is: How can you combat the unfortunate FOMO tendency and remain a stable and steadfast investor? Keep on reading to find out. 

Record Your Trades, Which You Can Later Review

Invest based on a well-thought-of plan or strategy so you’re prepared for any outcome. A journal can help you track your performance and improve your trading activity, as you have the chance to learn from your successful and not-so-successful trades. As simple as it might sound, it’s actually hard to get started. If you rely on the logs your cryptocurrency account provides, you’ll have insufficient information – it won’t tell you why you entered/exited the trade. A journal helps you understand the results of strategic decisions versus the trades made out of FOMO. 

Remember, There’s Always Another Market Opportunity Down the Road

Don’t get too wrapped up in volatility. If you react, what happens is that your emotions get the best of you. One trade seldom makes or breaks your investment portfolio, so even if Bitcoin surged to a fresh all-time high, there’s always another market opportunity down the road that can unlock substantial gains. Cryptocurrency investments require a long-term commitment, which translates into the fact that your capital will be tied up for a while. Not only should you have a clear and well-defined strategy but also a good understanding of your risk tolerance before making a move. 

Take Control And DYOR 

Before making a trading decision, it’s a good idea to do your own research. You should conduct thorough research and due diligence before making investment decisions instead of relying on opinions, advice or tips from others. Bitcoin offers excellent opportunities to earn money if you play your cards right. By embracing DYOR, you’ll start to identify red flags, such as low liquidity, which can hurt your funds. Read only trusted news and verify information from the source. Investing in Bitcoin is easier than you think. A spot ETF grants access to Bitcoin without the complications of direct ownership. 

Is A Cryptocurrency Bubble About to Burst, or Will It Become Mainstream? 

Bitcoin has a couple of metrics available that enable forecasting. Investors can make educated decisions when evaluating the cryptocurrency by paying attention to what the whales are doing. Only a few cryptocurrency holders own a significant amount of the available supply of Bitcoin, and their movements have a considerable impact on the market. Whales, as they’re referred to, play with the sentiments of investors (small fish), putting them in a state of FOMO. The outcome is that Bitcoin is now worth more than all the other digital assets. A potential bubble may be forming. 

As more people become aware of the potential for high returns, speculative investors break through the cryptocurrency market in an attempt to profit from the rising prices. No one really knows what will happen when and if the bubble bursts. You should reach out to your financial adviser about this so you’re aware of the risks versus the potential rewards. 

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