Cryptocurrency is now a major concept today. It all became possible with the advent of Bitcoin on 3rd January 2009. And the one who paved the idea of introducing the new monetary technology is none other than its founder, Satoshi Nakamoto. Till now there is no confirmed clue about whether this identity is an individual or a group. However, it hardly becomes any topic of discussion among people, who are more interested in knowing about various terminologies and theories related to crypto technology. One such is the technique of HODLing. Those who are newly introduced to cryptocurrency, should know about what is HODL in Crypto? So let us start understanding this terminology.
What Is HODL?
Before knowing the technique of HODling a Crypto, one must have a basic knowledge of the HODL. With the mention of the word, it must have given you a hint about the word which is commonly used by people. Yes, it is a hold or holding. Now, you will wonder, why this word is wrongly spelled, rather than the correct one?
This term was popularized on the Bitcoin forum by a user who in a drunken state, said ‘’I am HODLing’’. And thus, the term became popular, even though it is misspelled. However, it hardly matters whether the term is being wrongly spelled or not, the meaning is the same, to hold.
Since it is a term used in the cryptocurrency context, so definitely it means holding cryptocurrency. And the one who does it is known as HODLer. The technique of HODLing indicates the non-selling of BTCs by its users, at the time of the rise in its price.
Why Need To HODl, Instead Of Trading?
A question must have struck you regarding why one needs to HODL, instead of trade? The answer to this question can be explained according to some facts, which you should be knowing. First of all, a person must be aware of digital ledger technology, blockchain. Secondly, one must have the patience and ability to take risks and face losses.
Third, when there is no urgent need for money at the present stage. Besides this, if you are unable to know the reason for what you are planning to do. Also, the need for the technique of HODLing cryptocurrency is required when you hardly get time to measure the pace at which crypto space is running.
Technique Of HODLing
While understanding HODL, one must know how to practice it. Suppose a person trades for BTC for any altcoin, like say ETH, and has been HODLing it for a long time, indicating his positive approach towards the digital ledger, blockchain. Anyone who is newly introduced to the cryptocurrency concept must have a notion of Bitcoin as a source of decentralized payment method. After becoming familiar with its concept, a person becomes serious about not letting any unknown entity have access to icing the account, at the time of online purchasing.
Ethereum is the second most cryptocurrency after Bitcoin. It will strengthen your approach to new financial technology (cryptocurrency). It is better to HODL this top-notch alternate currency from ICO, and to diversify other ETHs into projects related to initial coin offering. Diversification of crypto assets is considered to be the safest method to avoid volatility.
Does HODLing Requires Experience?
Not. There is no mandatory need to be experienced or skilled, like most traders. Even if you are not a trader, you need not be perplexed. Whatever knowledge you have, stick to it. But you should be smart enough to predict the worth of a crypto coin for the future, and how it is going to perform in the coming week or month. This will help you assess the future perspective of dominant cryptocurrency Bitcoin, as well as other alternate coins. The technique of HODLing is to motivate people to not get anxious and proceed with selling during odd times in the market.
Those who have been familiar with the concept of cryptocurrency trading, buying and selling, must have chosen the strategy to sell their digital assets, with the expectation of price movement – either up or down, the other day. Well, it is all applicable in the crypto game. This is the reason why many people adopt the technique of HODLing to explore the minimal profits they can enjoy getting. Greed always breeds desire, that results in problems. The same is applicable in cryptocurrency. If you take a hasty decision, then you might suffer a hefty loss, much beyond your expectations.
So this is all you need to know about the technique of HODLing cryptocurrency mentioned in the blog. HODL is one of the pivotal terminologies in cryptocurrency, which every crypto enthusiast should be knowing. Even though the term is a misspelled version of the word, hold, still, it has been made a popular term, when a user in a drunken state mentioned ‘I AM HODLing’’ on Bitcoin Forum in December 2013. Since then, the term is known as HODL. It means holding a cryptocurrency, rather to sell it. If you want to stay abreast of the crypto news, then follow the cryptocurrency news feed on the Cryptoknowmics.