The crypto ecosystem has no shortage of jargon. Ambiguous phrases, acronyms and newly formed words that had almost no meaning a decade ago (or even a few months ago for many) are now widely used market signals informing strategic investment decisions. As Cryptocurrencies are natively digital, it is important to understand the vernacular, usage, and meaning of the digital vocabulary that has formed within the space.
FUD- Fear, Uncertainty, Doubt
These three words are in no short supply across the cryptocurrency ecosystem. They are common within any industry as early and quick to innovate as Digital Assets. While FUD’s origin stretches back hundreds of years, it reached wider usage in the 1970s to describe disinformation in the computer hardware industry. Since then, the FUD tactic has proven to be an effective competitive weapon across countless marketing and political campaigns.
FUD is a classic example of the logical fallacy argumentum ad metum, better known as Appeal to Fear. FUD is ultimately about developing the validity for one alternative by increasing the Fear, Uncertainty and Doubt of another. FUD aims to establish a “if that is bad, this must be good” response from its audience, building validity for one product by casting doubt on another.
Once FUD is isolated and scrutinized, the flaws of this approach become obvious. Just because one product is described as flawed does not automatically qualify its competitor as perfect. But, FUD can easily be hidden within a well structured or otherwise valid arguments, making it difficult for anyone to suppress their internal biases and spot the logical fallacy.
FUD often stems from the Digital Asset market’s competitive nature, rapid advancements, cryptically worded market signals, confusing pricing dynamics, and divisive shifts in user trends. In an environment where each product development, passing headline, or vague tweet can be either an opportunity or risk, Fear, Uncertainty and Doubt can reign supreme.
Traders need to be able to separate FUD from fact, interpret the meaning, anticipate the market’s reaction, and rapidly take action. Fear, Uncertainty, and Doubt can turn investors away from quality opportunities, distracting them with deceit and flawed arguments. Effective Digital Asset traders must develop the ability to compartmentalize FUD, seeing through the confusion while identifying market opportunities.
Daniel Pinto - Market Analyst @ TradingBull.io
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