Why is it so important to connect stoicism with crypto investing? It is significant because this mindset helps you to not lose money unnecessarily, and you can still sleep well during the night. This blog post is going to explain why this is the case.
What is stoicism
In order to know how the stoic mindset can help you in crypto investing, you also have to understand what stoicism is exactly.
Stoicism in itself is the practice of minimizing negative emotions to mostly feel the positive emotions. This helps you to deal with difficult situations, control yourself, be an example for other people, and to turn hardship into a positive experience.
The 4 main virtues are the pillars of stoicism that allow you to practice everything properly. These 4 virtues are also the basics for crypto investing.
4 pillars of stoicism applied to crypto investing
You have to be courageous to invest in crypto. It is a risk to invest your hard-earned money into a market that is very volatile. You are not authentic if you simply tell everybody how great crypto is and you don’t have invested money into it. You look like a fool if you are not courageous enough to do things that you encourage other people to do.
The crypto market is still very young. Bitcoin got invented in 2008 by Satoshi Nakamoto. This is only 14 years ago, and since then the technology has come a long way. However, there were of course frauds in the market or overhyped coins that have no intrinsic value. Stoicism simply teaches you to play fair and not steal money from other people in the crypto market. Participating in shady business in the crypto market harms the image of the crypto market and is another reason to practice justice because we want that the crypto market is successful.
You should not put all eggs in one basket. This means that you should diversify your crypto portfolio and that you should definitely not invest money that you require to live. You should invest appropriately so that you don’t miss out, but in a way that does not hurt you. This is what temperance can teach you from stoicism.
How do you know that crypto is the best investment at the moment? There has to be a reason. You should come to this conclusion by educating yourself about crypto. Consider receiving this information from different people that have a proven track record in this industry. This enables you to minimize your risks and to see opportunities where other people see nothing.
Stoicism prevents you from losing money and losing sleep
Most people that think about investing their money in crypto are either overhyped or they are skeptical. Stoicism helps to approach both situations in a rational manner in order to invest safely and to keep a calm mindset.
When you invest in crypto, you know that you can have huge gains which could potentially change your life. This is the main reason besides diversification and trust in blockchain technology why people start to invest in crypto.
The main problem with hoping for the price to go up is that it is speculation. It is not certain that you will ever see your invested money ever again because the prices of your coins could fall down to almost 0. On the other side, you have the opportunity to change your life if your coin has a 10x or 100x increase in value. This is exactly why people are skeptical and hyped about investing their money into crypto.
This volatility can screw up your mind. If the price goes down a lot, which is really common in the crypto market. Then you regret your investments. However, if the investment goes up you are hyped and want to invest more money because you think that if you had invested another 1000 Dollars then you would be rich.
This is dangerous thinking in both ways. You have to remind yourself that you are not in control if prices go up or down. This is the moment where stoicism comes into the equation of crypto investing. Stoicism teaches you that you should not worry about things you can’t control and should instead focus on the things you can control.
This means that you should have a clear strategy on how to invest in crypto, in which coins, and at which point you want to take your hard-earned money out. The rest is all luck, but you are in the right boat because you could potentially 10x your money, which is not easily possible in other investments.
If you don’t have the stoic mindset while investing in crypto, you tend to start getting greedy. As soon as you are greedy, you can lose a lot of money and have sleepless nights. This happens because your investments are not thought through anymore, and you already see yourself in a Lamborghini. These are the moments at which you start investing money you can’t lose and speculate on trades that are unlikely to succeed.
This greedy behavior could eventually cost you a lot of money and sleepless nights because you lost your money. This then causes you to feel stupid, and you are ashamed of yourself.
Before I adopted the stoic mindset for investing, I tried a lot of things and also got greedy. I once sent 5000 Ada, which is approximately 6000 dollars today, to another wallet. They promised to give me back 10’000 Ada, but I have never received these 10’000 Ada. I only acted out of greed and therefore lost my money and had some sleepless nights.
Now, with the stoic investing mindset, I have a plan and I stick to this investment plan. I don’t let feelings disrupt my decisions. Nowadays, I don’t just invest out of greed. I only invest money if I have it, and I don’t switch my investment strategy unless I am sufficiently educated about the new diversification.