Fear of Missing Out (FOMO)
What Is Fear of Missing Out (FOMO)
Fear of Missing Out, or FOMO, is the anxiety someone feels when they think they are missing out on rewarding experiences that others are having. In cryptocurrency, FOMO is the fear investors feel when they see a rapid rise in a cryptocurrency’s price and worry they will miss out on potential profits. This fear can lead to impulsive investment decisions, often resulting in significant financial losses.
Social media platforms and online forums amplify FOMO in the crypto market. When many people invest in a specific cryptocurrency and share positive experiences, especially stories of quick success, it heightens the fear of missing out among other investors. This prompts them to follow suit without thorough research or understanding the risks. Potential investors may develop unrealistic expectations about making substantial profits quickly, leading to impulsive investments, often at peak prices. If the price drops subsequently, these investors can suffer significant losses.