FOMO stands for Fear Of Missing Out, or the fear of missing out on something. Perhaps you have wanted something, and it had to be right away. Or you couldn't make it to that one party, and worried about what fun you were missing out on.
FOMO, or the fear of missing out on something, can have several causes, including social pressure from others, in real-life or perhaps through social media. It often arises when someone is afraid of making the wrong choice and therefore missing out on another experience.
People tend to follow the herd, and FOMO works especially well when people notice that the desired item is almost sold out. This often leads to a rush to get the item, for fear of being late. This "item" can be anything, such as a new model of a well-known watch brand, but during the onset of lockdowns, it can also be toilet paper.
FOMO in crypto
A lot of FOMO also exists within the crypto market. For example, when prices rise rapidly, or when new crypto coins are launched. However, FOMO and investing often do not go well together. Trading from emotion is never recommended.
Plus, if the masses are already interested in it and therefore FOMO is fueled, someone will no longer be among the group of first investors: there is little lead left to gain.
A good example of such a lead was during the spring of 2021, when Bored Apes NFTs were released. Back then, there was no FOMO yet and you could buy one for maybe ten euros or so. The price only began to rise in the weeks and months that followed, after it was already in the spotlight.
Although FOMO is widely used in the world of cryptocurrency, it was not originally a term specifically associated with crypto, unlike, say, "HODL." However, there are synonyms for FOMO that are used specifically in the crypto world, such as "aping" or "to ape," which refers to the behavior of investors who throw themselves into a particular cryptocurrency like rabid monkeys.
The information provided in our articles is intended solely for general informational purposes and does not constitute (financial) advice.