A friend of mine bought 1000€ worth of Bitcoin when it was sitting around 54K and before it climbed up to the ATH of 67ish - and now, he is feeling pretty foolish as he checks it daily to see how it is performing. However, if there is that future where Bitcoin hits one million, he will have around about 20K worth - worth it? Well, even if that takes 10 years, that is a 2000% gain - so that isn't too bad.
However, that is not the thing that is interesting about it - it is his behavior and emotional reaction to the loss of what is only a couple days salary for him. As said, he is checking it every day (multiple times) reading news about it and talking about where it might go in the future or, complaining about where it is now with the woulda, coulda, shoulda talk.
And, the reason that this is interesting is that in relation to the size of his income and traditional investments he already holds, this is a fraction of the total - meaning that this tiny amount doesn't really matter. But why it does matter is that along every step of the way, he was the one making the decisions - which makes him invested in more ways than just financially.
He made the decision to investigate and decide to buy. He set up the gateways. He made the transfers. He installed apps and learned how to use the exchanges. He made the purchases. He was not just calling the shots at every step of the way, he was making the shots.
This is a world of difference.
He isn't a consumer of investment vehicles, he is a participant, a player. And as a player, he is attached to "winning", which means that he learns and trains and actively keeps his eye on the game. When it comes to his other investments, he essentially gave the authority for someone else to play the game for him and this detaches himself from the outcomes, as while he is the one that is making the losses or gains, he isn't the one who played the game.
This allows him to distance himself by using a proxy - it isn't his bad decisions that saw him lose, it is someone else's. If he wins however, he will see himself as a savvy investor, as after all, he was the one who decided to invest - even though someone else was doing the investing.
There are obvious pros and cons to taking responsibility for oneself and the massive con is, feeling like an idiot when getting it wrong. However, as most people who are already in crypto understand that "loss" is often a case of resolution on the timeline - where those who are patient enough to ride out the bears into the bulls, will find that their "stupid loss" is somehow, an astronomical gain.
Then they feel stupid again.
They feel stupid because in all their cleverness of getting that astronomical gain, they still didn't buy more at the lows, which contradicts their feelings of savviness. If they are that good at investing, why didn't they buy more when they knew it was going to go up all along?
Well, because they didn't know and while it was down, they feared buying in and having it go down further, because that would make them bigger idiots - didn't they see the downward trend? Why didn't they listen to all those people saying "crypto is dead?"
Idiot!
But, I feel there are other values for my friend by going through this process, as he is learning a lot about a new technology, developing skills and understanding for investing and economics and most importantly, understanding how he thinks and behaves under different conditions that he hasn't had experience with before - since it wasn't him doing the work.
Yeah, he and we might feel like an idiot at times, but for him at least, the cost of these lessons is very cheap in comparison to what else he spends his money on for very little gain. And, not only that - it has actually given him a different "hobby" that entertains him in far more compelling ways that can actually lead to positive changes in his life, than the passive forms he might otherwise spend his time on.
As far as I am concerned, when it comes to consistent success investing, the things that sets apart good from bad is the attitude and mindset, the resilience and patience - the mental factors. These things are learnable, trainable and can be practiced, but to do so, experience is necessary.
On the upside and the down.
Feeling like an idiot?
How long for?
Taraz
[ Gen1: Hive ]
