I Will Teach You To Be Rich Author Ramit Sethi Comments On Faulty Bitcoin Holders Mentality
There are several investors in the market that hold their virtual currencies rather than buying and selling according to market fluctuations. This is something that has been highly criticized by several experts in the crypto world. Ramit Sethi, the author of the book called ‘I Will Teach You to Be Rich,’ says that crypto holders have an investment strategy that is based on emotions.
According to Mr. Sethi, investors take the decision to hold their virtual currencies due to their identity. This makes them make irrational decisions. If there is a bear market, it is better to sell rather than keep holding an asset that loses its value every month.
During 2018, virtual currencies experienced a very hard drop. Since their all-time high, several assets lost between 50% to 95% per cent of their value. Holders might have registered loses close to these numbers, which is clearly something negative.
Sethi says that there is a tendency for investors that did not make many from investing in crypto assets in holding their investment positions even when they lose. Additionally, there is a theory in which investors buy an asset in a market that does not give any signal to be recovering in the near future. For Sethi, this shows that there is a divorce from a rational investment.
Sethi mentions that there are some powerful and silent messages that affect how people behave in the market. Indeed, individuals take these messages as a way to live that has been imposed by a specific society. Nevertheless, this is dangerous if the rules are able to convince a lot of people to modify certain behaviors.
The bestseller author says that people should carry out a self-analysis related to the messages received. This would allow investors to avoid being irrational and behaving in a better way.
He said about it:
“I don’t mind identities. I have a few of my own: Personal finance guy, Gym rat, Hot sauce fan. But be extremely cautious about the messages you tell yourself because once you internalize it, you’ll do anything to justify your choices.”