The Psychology of HODLing, Why Many Don't Sell Even After Life Changing Profits

[Theupdude]

For a few days, I've been wondering if anyone bought hundreds or thousands of Bitcoins in the early days, when the price was a few dollars or less. Today, those same Bitcoins have made them millionaires or billionaires. But even when the price was approaching hundreds of thousands of dollars, many people still didn't sell their Bitcoins. From the outside, this seems absurd why would anyone give up such a large sum of money when it's right there? The answer lies not just in economics, but in human psychology. Thinking about this, I started a search and the following points made sense to me.


Belief in ideals

Many of the early Bitcoin users didn't just see it as an investment. They saw it as a kind of movement money independent of the government, censorship free transactions, and protection from inflation. For them, selling Bitcoin means abandoning this ideal. So many see holding on as a moral decision, not a financial one.
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Fear of regret

The moment of selling is the most difficult for people. Because once they sell, there is always a question in their mind What if the price doubles next year? The fear of missing out on this future opportunity forces many to HODL forever. As a result, many do not want to take the safe route and withdraw their money, but are comfortable holding on to it with risk.   

Becoming part of an identity

HODL is now a kind of badge of honor in the online Bitcoin community. Those who do not sell under any circumstances are called diamond hands. This identity has become so strong for many that selling means admitting weakness. In other words, HODLing is not only about money, but also has created a kind of social pride.
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Thinking in Bitcoin Instead of Dollars

A true HODLer does not measure Bitcoin in dollars. He does not have $1 million, he has 20 BTC that is the big deal. So no matter how much the price goes up, he thinks, If I sell, my Bitcoin will go down. This mindset never allows him to cash out completely.
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Insurance for the future

Many people hold Bitcoin as a form of insurance. They believe that fiat currency will collapse one day due to overprinting, debt burdens, or inflation. Having Bitcoin in hand is the real safety net. So for them, holding dollars means taking refuge in a weaker currency, which they do not want to do.
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The fun of the game

After all, there is no denying it it is also a game. Watching the market go up and down, hoping for the next bull run all of these things are exciting for many. Selling out and getting out of the game feels like taking away the real joy.
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[FortuneFollower]

Many didn't go in BTC because they simply didn't have much faith in it.

And when they did their research or went back to it - BTC was already big enough  

The best thing is that we can still go for BTC and achieve our targets.

[ANSEL_2.0]

Many didn't go in BTC because they simply didn't have much faith in it.

And when they did their research or went back to it - BTC was already big enough  

The best thing is that we can still go for BTC and achieve our targets.

The biggest lesson with not only Bitcoin but digital currency in general is to avoid selling all at once because they are in big profit, some one who have 100 BTC in 2021 and sold them for 60,000 each must have thought he is wiser, if you have that much there is nothing that will hurt you if you leave 10 behind for maybe in the future the value can double again.

If fear of missing out is a real thing why aren't people doing this? They always sell everything like its all over, whereas this whole crypto thing is always cycle base, Bitcoin had proven it worth countless time, it is only a fool that will DCA and when it is the time to take profits they dump all they have.

I will keep taking profit but I will never be out of Bitcoin for any reason.

[The Cryptovator]

Fear of regret
The moment of selling is the most difficult for people. Because once they sell, there is always a question in their mind What if the price doubles next year? The fear of missing out on this future opportunity forces many to HODL forever. As a result, many do not want to take the safe route and withdraw their money, but are comfortable holding on to it with risk.   

This is exactly what is on my mind. Trust me, whenever I sold my holdings, they doubled in the next couple of months. I bought Bitcoin for $25K and sold after some profits; it was for trading purposes, but after I sold, Bitcoin never came back to that range. I thought I would buy when it dumps again, but it never happened. That's the reason why I fear to sell my holdings. Also, that's the reason I lost the opportunity to earn some profits from the earnings as well.

Last month I traded my holdings two times and made some profits as well. Though I had fear of loss, I took the risk. Eventually I could buy it at a lower price from the dump and hold the same amount right now. I decided to do scalping sometimes when I feel it's safe to do.

[Josefjix]

I got scared of selling assets too much for money I may not need, I only make sure my assets are increasing in quantity, I haven't find it favorable to sell off assets and rebuy when the price is dip, I've been very unlucky whenever such happens.

Also, I noticed been a long term holder gives me the profit than short term trading, after all, what should I want with the profits if I sell, so I keep holding.

[Iron Fist]

Yeah, I don't hold much, but I think you nailed it with the HODLer psychology analysis. It really clears up a lot of the seeming craziness. They aren't dumb. They truly think the dollar is going to crash, and that Bitcoin is the stronger bet That’s why selling Bitcoin to them feels like swapping gold for fake monopoly money. It kinda makes sense, but man, what a risky gamble!