The 5 Most Important Tips for Crypto Hodlers

When prices drop and the first bears are spotted, it's important to know how to survive.

When prices fall and the first bears are spotted, it's important to know how to survive. Five tips for real crypto hodlers.

Writer Daphne Rose Kingma once mused: "Holding on is believing that there is only a past; letting go is knowing that there is a future."

If you apply this analogy to the crypto space, you can be labeled a so-called paperhand. Those who refuse to part with their holdings are seen as diamond hands. For long-term holders, it’s especially important—in tough market times—to know how to keep their cryptocurrencies together. Five key tips for hodlers.

Tip 1: Do Your Own Research (DYOR)

In principle, every investment should be supported by prior research. By filtering information with purpose, you can be confident whether investing in a specific asset makes sense or not. You can also verify the background of the project.

It's important to remember to use a mix of sources. So it’s important to check all the relevant data: the white paper, YouTube videos, market data, blockchain explorers, the social media community, and more. If you know what you’re getting into, you can lean back and stay calm in difficult times.

Tip 2: Be Able to Counter FUD Messages

The right line between FUD messages and constructive criticism runs in parallel. The better informed you are in advance, the easier it is to tell them apart. It becomes quickly clear whether a message is relevant to the project’s future or not. It’s always important to address the concerns. By the way, to stay calm you need to know the answer to common FUD lines.

Tip 3: Save Plan Hodl

Once you’re on the rabbit hole, one thing is especially hard: saying “no.” Investing becomes a real habit. Those who start collecting cryptocurrencies keep wanting more. Even professional traders get swept up by the fear of missing out and give in to the urge to build positions as fast as possible. In short: Fear of Missing Out (FOMO).

To stay a relaxed Hodler, a savings plan helps. The "cost averaging" strategy means making regular investment decisions within a set period, independent of the market. The advantage is that it minimizes impulse buys while rational decisions take precedence. At the same time, the investments are allocated so that an average price per unit invested is calculated.

In this hypothetical example the investor used a dollar-cost-averaging approach and made regular investments of $100 per month. When stock prices were higher, he bought fewer shares; when they were lower, he bought more.

If the investor had invested $1,200 via a lump-sum approach, the average cost per share would be $25. The savings plan strategy could have driven those costs down.

Tip 4: Just Hodl

To summarize again: Gather facts, debunk misinformation, and then invest the right way. By the way, the term Hodl comes from a post by user "GameKyyubi." On December 18, 2013, he posted on the BitcoinTalk.org forum with the headline "I AM HODLING." There he described that his girlfriend was in a bar and the Bitcoin price had crashed. Despite all the advice to sell, he chose the opposite and held onto the coins. He justified it by saying he was just a bad trader. He apologized for the spelling mistake by saying he was drunk at the time. Now there’s one thing left to do: Hodling.

Tip 5: Exit Strategy

bridges collapse, kingdoms fall, heartbreak heals, and Ethereum now runs on Proof of Stake (PoS). Daphne Kingma's quote also fits the crypto space very well. Sometimes letting go is the better option—even for Hodlers.

Especially when a project fundamentally changes, your investment strategy should be re-evaluated. This was the case with Ethereum’s recent successful merge. The consensus mechanism changed: the crypto project now runs on a PoS basis. Stubborn ETH miners objected and carried out a hard fork.

That’s why you should think ahead about an exit strategy. Even if nothing changes about the project’s core structure, it’s good to have a contingency plan. As we all know, safer now beats a regret later. This also applies to hodling.