Why do people FOMO into crypto?

Why do people FOMO into crypto?

By bengy | Idle Musings | 24 Oct 2021


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Well... I already know the answer to that! I'm guessing that in many ways, people want to jump into something, thinking that they have the advance lead or alpha on a project, not realising that the others are going to dump all over them! In fact, in my own personal situation, I'm always quite wary of anything... and I've missed out on early alphas due to that. I won't commit everything to a single asset, and I'm always hedging... it means that I don't tend to make gigantic breaks, but more importantly, I tend not to lose gigantic amounts either! It is a really slow and steady approach that seems to work just fine for me... but I guess that there are more than enough people who prefer the quick pump and dumps adrenaline rushes. I personally love those things myself... but I'm really careful to be on the dumping side of things and avoid the buying side like the plague, that is done by not playing unless I'm playing with house money.. and then with very clear cut goals for exit in mind and rigorously adhered to!

Perhaps something that also feeds into all of this is the fact that Crypto-Twitter and social media in general is full of success stories... stories of some guy making trillions of euros in a single trade at 10000000% leverage. What you don't get is the stories of the people who crash out instead. Especially, for one person to come out big... there must be others who have lost big.

... but I guess that starry eyed dreams of financial independence or just increasing a particular number can cloud our better judgement... so, I'm not being judgemental or critical... just insanely curious about what makes people tick!

 

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Just recently, Binance Launchpad had a subscription round for BNB holders to purchase LAZIO tokens at 1 USD. I had taken part in the launchpad and immediately dumped all the LAZIO tokens as they were of little worth to me (and to be honest, I fail to see the worth of fan tokens at the moment). This is stark contrast to other launchpads where I've aimed to maximise the token moonbag whilst also making a profit.

Now, this seemed like the only logical play to me... in fact, I was so convinced that the LAZIO token would crash like crazy in the first couple of minutes after listing. So, imagine my surprise when I saw under the Binance Twitter announcement of the LAZIO token lots of people complaining that they had lost huge amounts of money on the purchasing LAZIO in the first few minutes after the market opening!

It just seems insane to me to purchase in the seconds after market open... as the price is stupidly volatile, and bots are hammering the volatility to make easy profits! So, why do mere humans think that they have a chance to purchase and NOT come out at a huge loss?

Sadly, enough people did think that they could game the system... and had purchased LAZIO at prices between 30-100 dollars! It is currently worth around 13 dollars... By the time that I had managed to dump, it was already sitting at around 25 dollars (which is an easy 25x for me... but an incredibly bad deal for the counterparty!).

What baffles me even more is the fact that buyers of LAZIO must have KNOWN that a dumping wave was incoming... after all, there were 4 million LAZIO tokens that were just distributed at 1 dollar a piece! And if the price was anything above 1 dollar... there would be some serious selling pressure!

So, why do people do it? Do they really thing that numbers will only go up? Do they not realise that there is a huge dump incoming? Did they mis-understand the terms of the Launchpad and the opening price of the market opening? Did they just get greedy? Are they just crazy Lazio fans?

I'm honestly intrigued... there was no way that any buyers in the first few minutes were going to get anything other than horribly overpriced tokens... and yet there were people commited more money than they had to lose.... or at least that was what they were claiming on Twitter.

Again... why are people playing the hugely risky plays, when they don't have the money to do it? Is the allure of quick money that enticing? Perhaps the payoff is just too irresistible?

I don't understand it... I feel a little bit sorry for dumping on the buyers... but why do people do it?

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I can also be found cross-posting at:
Hive
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Handy Crypto Tools

Ledger Nano S/X: Keep your crypto safe and offline with the leading hardware wallet provider. Not your keys, not your crypto!
Binance: My first choice of centralised exchange, featuring a wide variety of crypto and savings products.
Kucoin: My second choice in exchanges, many tokens listed here that you can't get on Binance!
FTX: Regulated US-based exchange with some pretty interesting and useful discounts on trading and withdrawal fees for FTT holders. Decent fiat on-ramp as well!
MXC: Listings of lots of interesting tokens that are usually only available on DEXs. Avoid high gas prices!
Coinbase: If you need a regulated and safe environment to trade, this is the first exchange for most newcomers!
Crypto.com: Mixed feelings, but they have the BEST looking VISA debit card in existence! Seriously, it is beautiful!
CoinList: Access to early investor and crowdsale of vetted and reserached projects.
Cointracking: Automated or manual tracking of crypto for accounting and taxation reports.
Stoic: A USD maximisation bot trading on Binance using long-term long strategies, powered by the AI/human system of Cindicator.
StakeDAO: Decentralised pooled staking of PoS assets.

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bengy
bengy

I am a Musician (Violinist/Violist) specialising in Early Music living in The Netherlands. I have a background in Mathematics and Physics due to an earlier tertiary level study... and so, I'm still quite interested in Science and Technology related stuff!


Idle Musings
Idle Musings

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