Anyone who has ever heard of Bitcoin may have heard of HODL as well. Because HODL is a very famous strategy to speculate on long-term price gains of Bitcoin, whereby "long term" is not defined in detail, how long it really is.
HODL dates back to a
Bitcointalk post from 2013, where it was advised not to sell one's own Bitcoins despite losses, but to wait patiently until it rises again.
However, it is indeed essential to wait, because most common errors from HODL are:
- Sold all
BTC too early to realize (small) profits
- Sold all
BTC too early to minimize losses in case of decreasing prices
Additional mistakes can be dangerous coin storage practices, for example on a file-sharing platform, which is increasing risks of getting hacked. But in my post and for advanced Bitcoin HODLers it is assumed our coins are stored properly, which HODL also invites us to do, because HODL only required to transfer our coins on very rare occasions (if at all), which minimizes transferring or storage errors.
As a conclusion we should keep in mind: most common mistakes of HODL are quick sales of our valuable BTC. So, we have to be aware and know that HODL is purely a mental challenge.
A good HODLer can resist any temptation to make (small) profits prematurely and a good HODLer keeps his Bitcoin.
A good HODLer stays cool even in case of losses. Best we can do is to move our valuable Bitcoin somewhere where it has a high resistance of being sold.
And we shouldn't store it on file-sharing networks anyways and also not on centralized exchanges because we don't have our private key on such platforms (not your key, not your coins).
After all, it's a very important lesson to know that HODL is purely a mental challenge. If you want to HODL correctly, you should know and pay attention to all points mentioned above.
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