While many of us would like to claim that we got into cryptocurrency for the tech and how it has the potential to change the world. But, the reality is that most of us got into crypto with hopes of changing our lives financially. With hopes of being able to escape that 9 to 5 job, finally being able to pay our debt, or becoming wealthy and no longer needing to think about money.
Many of us view it as our one chance to finally get ahead in life and therefore want to go all in. Some of us who got into crypto at a later time will even try to invest harder to make up for the lost time. Comparing our own journey to the influencers or friends and family that got into crypto before us. That is one of the most dangerous things that you can do. The crypto market is already risky and one of the most volatile asset classes you can invest in. By trying to make up ground and become rich quickly people will try to trade with leverage or buy coins that have very little chance of becoming successful. It’s so easy to lose your money in this market, but if you can invest in the right projects and survive the market. You’ll have a very good chance to be successful in the long term.
However, even if you do invest in the right projects such as Bitcoin, Ethereum, or a few others. People who have great conviction in the future of the market and where crypto prices will be moving towards often want to buy as much as possible. They feel there will be a once-in-a-generation wealth transfer and they want to be included in this. This causes them to feel extreme FOMO, (fear of missing out) and therefore invest far more than they should. Which often causes unexpected problems for them.
These problems, are signs that you are investing too much money into crypto. Which could affect your ability to stay in this market. The worst feeling in the world would be right about the future price potential that crypto had, but now being able to stay in the market because market stress began to affect you.
Here are the signs that maybe you’re investing too much money in crypto.
1. Downward Price Movements Stress You Out or Affect Your Mood
When most of us first began investing in crypto, one of the key things that we were told was that we need to have a long-term timeline. Meaning that Bitcoin has incredible potential, but it will take quite some time to reach that potential. In between, there will be plenty of price movements upwards, and perhaps even more movements to the downside. Since we should have a long-term approach we don’t need to worry about the day-to-day price movements, as we won’t be selling anytime soon. Therefore, most price movements should have little-to-no affect on us.
However, if the recent price dips have stressed you out, affected your mood, and made you begin questioning if you made the correct decision to invest in the crypto market. This probably means that you have put too much money into this asset class. One of the best pieces of advice that everyone should know when entering the crypto market is to “only invest what you can afford to lose.” Once you adopt this mindset and truly accept that anything you invest in crypto could very well go to zero, that will help to eliminate a lot of the stress that comes from the price dropping. It’s already money that you mentally accepted could be lost.
2. Constantly Checking Prices
Checking the prices of crypto often can quickly become an addiction that leads you to constantly check all day. The first thing you do in the morning, always having price tabs open on your computer, checking apps on your phone, the last thing you do before going to bed, and even checking in the middle of the night. These are all signs that you are too caught up in the performance of crypto. Perhaps the root cause of this is that you have invested too high of a percentage of your money in crypto.
3. Affecting Sleep
If you lay awake at night constantly thinking or worrying about crypto, its price dropping, and when prices might begin recovering. That likely means that you have invested too much into crypto. Stress can be a horrible thing. Combining that with a lack of sleep, and soon you being too invested in crypto could affect your health. Which could begin to cause many other problems. As I mentioned before, being able to stay in the crypto market is the key to being successful. Not taking care of your health or being too stressed out, greatly reduces your chances of being able to do that.
4. Unable to pay bills / No Money Outside of Crypto
This is a no-brainer, but if you are unable to pay for bills and necessities, that means you are investing far too much into crypto. This goes for all financial investing as well. Before even thinking about investing you need to take care of rent, insurance, credit card debt, food, and other bills. The money that you have left over after that can be invested however you like. The key thing is that even if Bitcoin, Ethereum, or crypto went to zero. You would still be okay because you’re able to handle all your necessary expenses. This will begin to eliminate a lot of the stress that you might feel when prices are volatile. You’ll feel even better if you have other cash savings or assets that aren’t correlated to crypto.
5. Unable to enjoy life, or have fun
The crypto market can be pretty exhausting at times and you need to find ways outside of it to keep life “fun” and have distractions. Things such as going to movies, traveling, meeting friends, playing games and the list goes on. If you're unable to do this because you're too strapped for cash, then you might have too much invested in crypto. Also, if prices have you feeling depressed and no longer enjoy being in the market. That also might mean you have too much invested in crypto.
This is a long journey that we are all on to reach the full potential that this market has to offer. Those of us who are able to stay on this bumpy rollercoaster until we reach that final destination will be greatly rewarded. Most likely having their lives changed financially forever. But it's also important that you invest responsibly. Always remember to enjoy today, because tomorrow is not guaranteed. In life and with crypto. Stress can make people do silly things. I wouldn’t want the regret of selling a life-changing asset too early because I invested too heavily and the stress got to me.
How about you? Do you match with any of these signs? What are other signs that I missed?
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