FUD is an acronym for Fear, Uncertainty, and Doubt. It is a psychological manipulation tactic used in marketing, politics, radio and TV, religion, and propaganda. The impact of FUD on the cryptocurrency market can be pretty huge, especially when compared to other traditional markets.
In this article, we’ll take a closer look at FUD and all the ways it affects cryptocurrency prices. What is FUD crypto? Let’s try to find out!
What Is FUD in Crypto: Basic Things to Know
So, what is FUD in crypto? As was mentioned before, FUD is an acronym for Fear, Uncertainty, and Doubt. It is a market manipulation tactic, which uses disinformation to generate negative emotions regarding a product, usually an asset or technology. FUD is usually implemented through the publication of negative and fake news.
For example, Microsoft has used this tactic against Linux operating systems since the 1990s. Thus, Microsoft’s competitors were considered as unreliable and insecure patent rights infringers.
FUD can be roughly divided into naturally occurring and artificially created. Natural reasons for FUD in the cryptocurrency market may be negative news about a country tightening the screws. For example, the tightening of crypto regulation in the USA can shake the entire market, causing panic and doubt that cryptocurrencies will still exist.
What is crypto FUD of the second type? Well, artificially created FUD is usually negative materials published by the press, citing suspiciously unnamed sources or Elon Musk’s eccentric antics on his Twitter.
The CEO of the largest cryptocurrency exchange Binance Changpeng Zhao, based on his own rich experience, argues that no bull market is complete without FUD. So if you read the suspicious negative news provoking fear around cryptocurrencies, you should ignore FUD, do not sell any assets and stay calm.
What Is FUD Cryptocurrency: Why Crypto Investors Are Affected by FUD?
What is FUD cryptocurrency panic? FUD manifests itself very strongly in the crypto sector due to one feature of digital coins — the lack of security. Nobody knows the true identity of BTC’s creator Satoshi Nakamoto.
And neither he himself nor any government, company, organization guarantee that Bitcoin will not fall below $5,000, $1,000, or $100. And even if it costs $61,000 on the exchanges, no store or bank is obliged to accept bitcoins.
This fact gave rise to the rather popular concept of Bitcoin as a bubble and a financial pyramid that will soon crash. Among its supporters are well-known personalities — directors of corporations, bankers, economists, or large investors.
Famous People Who Don’t Trust Crypto
What is FUD crypto main reason? When famous or influential people speak out against cryptocurrencies, this can also cause FUD. Here is the list of a few famous people who have spoken out against Bitcoin or other cryptocurrencies:
- Warren Buffett, CEO of Berkshire Hathaway Inc.
- Brian Moynihan, CEO of Bank of America,
- Ben Bernanke, former chairman of the US Federal Reserve.
One person was also particularly critical of cryptocurrencies, and his comments caused an extremely high level of FUD. This man is Jamie Dimon, CEO of JP Morgan Chase. Thus, Jamie Dimon famously stated:
Bitcoin is a fraud that will blow up. It’s just not a real thing, eventually it will be closed. It’s worse than tulip bulbs. It won’t end well. Someone is going to get killed.
After Jamie Dimon made these statements to the press, Bitcoin’s price decreased by 6%.
Jamie Dimon has since changed his stance on Bitcoin and stated that he regrets calling bitcoin a fraud:
Blockchain is a real technology. You can have cryptodollars in yen and stuff like that.
Although he changed his stance on BTC, this still did not stop him from causing a lot of FUD around cryptocurrencies and lowering their price.
What Is Crypto FUD: How to Avoid FUD?
Once we have found out ‘What is FUD in crypto?’, let’s consider all the ways you can avoid FUD. Well, the key thing is to learn to think, analyze and read between the lines. After all, there will be more and more FUD attacks on the market. New projects are launched, and new cryptocurrencies appear every single day. That’s why you should:
- always realize what and where you read & analyze all the information;
- use official sources first;
- never jump to conclusions — use your brain and logic;
- learn constantly.
What is FUD cryptocurrency panic? Does it really have sense? Well, just remember that Bitcoin has been buried more than 300 times. In particular, Nouriel Roubini, winner of the Nobel Prize in Economics, announced the crash of Bitcoin back in 2013.
After that, Bitcoin saw many ups and downs, but BTC’s price was always at least several thousand dollars no matter how much it fell. But after every Bitcoin burial, thousands of investors sold off their digital assets and lost money due to FUD.
Thus, if you want to make money on digital assets, trade like a pro. Think of downs not as a sign of crash but as an opportunity to buy more bitcoins at a lower price. Just remember that crypto coins are not dollars and euros, which can be printed in arbitrary quantities — the number of bitcoins is strictly limited. And those who enter the crypto market later are forced to buy bitcoins at a higher price. That’s why the rate will only grow in the long term.
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What is crypto FUD? What other interesting facts do you know? Feel free to share your knowledge in the comments!