Takeaways:
– HODL is a word that first appeared in a 2013 thread on the Bitcoin Talks forum.
– HODL suggests you shouldn’t sell your cryptocurrency even if the price drops dramatically
-Holding on to your cryptocurrency for a long period of time might result in a substantial financial gain. Keep your cryptocurrency safe while HODLing. Ledger’s hardware wallets are perfect for this purpose.
Many people who aren’t acquainted with crypto may first think that “HODL” is a typo, but as they see it used hundreds of thousands of times, they realize it’s not. But for those who are well-versed in cryptography, it’s almost a way of life. In this piece, we want to aid individuals who aren’t yet fluent in crypto jargon and provide light on why hodling may be worthwhile.
The Origins of “HODL”:
In the morning of a December day in 2013, it all began. The price of bitcoin dropped to a “low point” of $447, an almost 40% drop from its previous peak. In a panic, many early adopters dumped their BTC holdings. A single Bitcoin user, though, declined.
GameKyuubi, a member of the Bitcoin Talk forums, was having none of it, declaring in a thread titled “I AM HODLING” that he had no intention of selling and giving in to the market’s decline. His preference was to remain as a “part of the market capital” rather than join the ranks of the day traders. As an alternative, he would HODL.
GameKyuubi said that he was aware of the title’s misspelling but decided to continue with it anyhow, and the audience responded positively. They adored the word “HODL,” and it has since become an essential component of the crypto community’s lexicon.
The meaning of crypto hodling:
Hold On for Dear Life, or HODL for short, is the strategy of retaining Bitcoin and other cryptocurrencies during market downturns rather than selling. This strategy is in direct opposition to that of day traders, who aim to maximize their earnings by strategically entering and exiting the market at certain times. In the event of a market crisis, hodling is advocated as a preventative strategy against panic selling.
What it means to “HODL” Bitcoin is to keep your coins for a long time, regardless of price changes. It is assumed that the value of Bitcoin and other cryptocurrencies will continue to rise gradually over time. Hodling is not only one of the two main investing methods; it may be considered as both of them (the other being trading). For many in the crypto world, this is now just how they live. Purchasing their cryptocurrency, then carefully storing it while they wait. Some cryptocurrency holders (HODLers) have a strong conviction in the technology behind their holdings and anticipate that cryptocurrencies will one day replace traditional currencies. The Hodler community is incredibly supportive of one another, spurring each other on to keep fighting the good fight.
Then why is it pleasurable to hodl?
Reasons Why You Should Keep Holding On to Your Coins
Use GameKyuubi as an example. When Bitcoin was trading at $447, he didn’t sell it. Considering the current price of roughly $11,500, it is a massive gain in value of around 2570%, or more than 25 times!
While it’s true that trading may provide much higher profits, it’s also true that other methods can. Those who are seasoned traders who are able to sell their cryptocurrency at peak levels and purchase on dips may get a greater return. On the other hand, the stakes are far higher. There is a lot of difficulty in knowing when to enter or exit the market. When asked about selling in a downturn, GameKyuubi said, “You only sell if you are a strong day trader… folks in between keep.”
Therefore, hodling is often considered a much more secure and steady method of investing in cryptocurrencies, particularly for newbies. Any investment still carries some degree of uncertainty. No one can predict the future, and here at Ledger, we are not in the business of giving money advice. However, the approach of hoarding has worked well thus far.
Take care to judiciously HODL
The term “HODL” refers to the practice of holding on to cryptocurrency for an extended period of time. When you’re in it for the long haul, like years, you need a safe place to keep your Bitcoin or other cryptocurrency. Imagine you had your BTC stored on an exchange, and then your login information were compromised, or even worse, the firm went out of business. Absolutely, safe hoarding is of paramount significance…
And that’s where we come in.
Hardware wallets like the ones we make at Ledger are the best way to ensure the safety of your cryptocurrency. The Private keys to your coins are safely stored offline in our devices, in extremely sophisticated chips that are immune to internet assaults. These chips can withstand a lot of abuse and still function properly. The Recovery Phrase is a string of 24 words that may be used to regain access to your Ledger and its crypto assets in the event that the device is lost or stolen.