There is no one in the crypto money market who has not heard of some concepts.
In this article, we will talk about the concept of FUD, which we often hear especially when the market falls hard, how to get rid of this psychology and how to trade without getting caught in the FUD.
What is FUD?
In fact, FUD, which is used not only in the crypto market but in all other markets, is an abbreviation of the words Fear (fear), Uncertainty (uncertainty) and Doubt (doubt). This word, which consists of the concepts of fear, uncertainty and doubt, is often used in the cryptocurrency markets.
FUD, which can be done about a person, institution or any product with financial value, is used more in the crypto money industry, although it is used in every market.
This concept is actually the most basic “attack method” that causes many investors to lose.
Why Is FUD Being Done More In The Cryptocurrency Market?
Since cryptocurrencies are in an unregulated structure compared to other markets, it can actually be much easier to make false or deceptive news in this sector. Blocking such sources of FUD is usually shaped by the laws of the country.
When a deceptive news is made about any stock, it is possible to file a criminal complaint about the news source and have this news removed, but this is not really possible in cryptocurrencies.
Because, unfortunately, there is no authority to prevent this when there is a fake, deceptive or panic-inducing news about Bitcoin, which has a decentralized structure. For this reason, crypto money markets offer a more favorable environment for spreading FUD than all other markets.
How is FUD Made?
FUD is often done by spreading unduly exaggerated or untrue news that could adversely affect the market.
This event, also called spreading FUD, will be successful the more people it can have an impact on.
Why Create FUD in Crypto Markets?
FUDs spread to discredit and devalue any cryptocurrency are made to create “fear, uncertainty and doubt” with thoughts such as “the price will drop more, I’m losing all my money” by negatively affecting the psychology of the general investor mass.
Thus, the markets are manipulated and as a result, the price falls.
By spreading FUD to the masses; Fear is systematically pumped into the market and the price is manipulated. Thus, speculators who spread FUD usually buy the products of the investors, for whom they spread fear by taking advantage of price fluctuations, by selling at a loss.
In the end, as always, it is the small investor who suffers from this situation.
Big Business Is Falling On The Stock Exchanges!
An important task in the fight against FUDs falls on the crypto currency exchanges, which are the most important actors of the ecosystem. Although no stock market has taken a step in this direction at the moment, only the public stock market, KuCoin, aims to fight effectively against FUDs that damage the image of the whole market with the Anti-FUD Fund.
The Anti-FUD program has set out to protect users in the crypto market. Thanks to this program, users can learn fake news, continue their investments without fear and anxiety, or make buy and sell transactions according to their decisions.
Although it is not very possible to avoid 100% of FUDs, KuCoin exchange aims to protect the market by making the following breakthroughs, after investors usually lose their money due to this reason.
- To increase the knowledge level of investors by providing online and offline trainings in more than 20 languages.
- KuCoin will reward and support industry leaders who fight FUDs, find and correct fake news in the market, and inform people.
- To initiate legal action, when necessary, against persons or entities that knowingly disseminate FUDs.
Who Spreads FUD?
If we summarize those who emit FUD in a few items:
- In particular, individuals, groups or institutions who want the price of any product not to increase.
- Those who want to buy the relevant product at a lower price
- News sites or phenomena that make an interesting and negative old/fake news just to get more engagement.
How Does FUD Spread?
FUD is usually spread on the market by famous people, news sites, social media influencers. It is important to reach large audiences in spreading FUD. Because the more people are caught in fear and uncertainty, the more the value of the product or person falls in the eyes of the public.
Widespread FUDs are much more effective for price manipulations.
In particular, people like Elon Musk have done in the past, respectively:
- Saying “We will use BTC to sell Tesla products” and then,
- It’s like saying, “We gave up selling Tesla products with BTC because Bitcoin doesn’t use clean energy.”
In the first item, FOMO (fear of missing the opportunity, it can be said the opposite of FUD) is created on the markets and the price is pulled up, while in the second item, FUD is created and the price is driven to the bottom.
Especially in the USA, it is quite common for anti-Bitcoin people or institutions to use the power of the media to introduce old news to the market as if it were new and to spread FUD to the markets. Again, this situation is very common in China.
What To Do To Avoid Getting FUD?
The biggest enemy of FUD is actually information. As investors unconsciously believe in every news and take positions accordingly, the price of the crypto money that spreads FUD in the herd psychology may decrease.
Especially when a news or announcement is seen, the truth of it should be investigated. This news can be from a fake or hacked account, or it can be from a large solid news source.
Unfortunately, many news sources can “pump” old news that is negative for the market as if it were new. These can be done to gain hits or deliberately “malicious people” to manipulate the market.
For this reason, it is very important to investigate when there is negative news that may seriously affect the market from any source.
It will also be very useful to have information about the product invested in.
For example, if you are investing in Bitcoin, to have information about it; It will ensure that you do not believe the false news that “Bitcoin mining can no longer be done by anyone” and that you do not make a wrong move by being caught up in this negative news.
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