Crypto

Why don’t people buy when the price is low?

I’ve been following bitcoin for years and the dynamics are always the same: when the price is high, people appreciate it and everyone buys as if it were going to go up indefinitely. Or they say: if it drops by 50% I go all-in! Then the price goes down and btc starts to be despised and nobody wants it anymore. In your opinion, what is the thought process that leads most people to think backwards?

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26 Comments

  1. Theres momentum down and everyone hates being in the red right after you buy. Buying on upward momentum usually leads to being green right after buying.
    People are bad at the long game.

  2. why would they do that? They just buy high when it is rising and sell low when it is dumping.. they are like sheep following the trend

  3. Outsiders* operate on the assumption that bitcoin will fail. The price going down confirms this. The price going up makes them think again. This cycle continues until they catch on.

  4. Hello, I’m a bot that tags users when they make interesting comments, here’s yours:

    > 5-25-21: “The big problem with bitcoin, which raises many doubts about its future, is that after 12 years it is still useless. Nobody buys it to do something with it. It is completely useless”.

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  5. Read the book The Intelligent Investor. If I remember correctly it covers this topic extremely well in the first or second chapter. Overall an amazing book no matter the investment tool you use.

  6. Low is relative. Low relative to 3 months ago? yes. Low relative to $5k – $12k range which we had for 3 years? No

  7. Paper hands were never here for the fundamentals and were only here to get rich quick. At the first sign of trouble they bail.

    They will be back at $100k asking if that is a good time to buy.

    Lastly I am always buying. DCA is the way.

  8. Ask the idiots. I’ve bought, and I’ll buy more this Friday. Buy buy buy. That’s how you make money in crypto, buy it when it dumping then profit when it reaches the ATH and sell a little then wait for it to dump again then use that money to buy more. Let’s just face the basic facts, some people just shouldn’t be in crypto if something this small scares them. Seriously. Go invest in AMC or Budweiser or some shit like that.

  9. Once it starts dipping, folks get scared it will bottom out waaayyy further before it hits bedrock. They try to time the market instead of DCA, or are plain worried that btc/crypto will finally, truly be dead.

    An emotional approach but hey, very little about this market is logical.

  10. Well I can only speak for myself. I bought all I had left when it last touched 29k. Now I just can HODL…

  11. Myopic loss aversion.

    Noble prize winner Richard Thaler did a groundbreaking study.

    He found that psychologically people hate the thought of losing money two and a half times more than the thought of gaining money.

    This mental state gets in the way of long term thinking.

    When any asset we think has a great long term feature crashes we should be thinking: Great! This is on sale!

    But instead we think:
    I am going to lose all my money!
    What if it keeps crashing!

  12. They extrapolate forwards. If it’s going up, then it’s going up for ever. When it’s dropping, they think it’s heading to zero.

    HODL’ers also extrapolate forwards, but with a zoomed out chart.

  13. Because they don’t actually believe it is as valuable as it’s claimed to be and they don’t want to get burned. They’re just trying to catch a wave.

  14. How do you decide when the price is low? When prices rise quickly, they can fall just as quickly.

    Just 9 months ago it was at 10k. It’s now at 30k.

    If you want to know where the bottom is, you need to work out the trend on which new long term holders are added. They’re the people who kept the price where it was after the last crash and newcomers with similar testicular fortitude.

    Fair weather traders who just got caught up in the mania bought the fomo and sold on fud, like they always do… and some are still hanging on due to the sunk costs fallacy, but will have a bottom in mind.

    You can find the trend of true holders by looking at a 5 year chart and drawing a trend line that connects the bottoms of all the dips.

  15. Fear, same reason people don’t buy in a stock market crash, always that worry of impending doom and the whole world will collapse after you buy and you’ll lose all your mined fiat

  16. People see it’s safer to buy when things are clearly going up. When things are going down, people hold off from buying.

  17. Like, why didn’t people buy when it dipped all the way to $50,000? There is a saying: don’t try to catch a falling knife.

  18. 2 reasons:

    People are impatient and people are lazy. They want instant gratification which makes them FOMO in during ATH rallies. They also tend to follow the herd instead of doing their own research. So many people, even crypto fans have such a short time horizon. I don’t get it either, most people settle for a 401k that yields on average 8% without recessions. But very few people will DCA BTC long term and reap the 100-200% annualized returns.

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