“HODL” is a very common term, and it is commonly used in anything related to cryptocurrency. But most of us have failed to understand the real meaning of the term “HODL.” But while using the BitcoinDigital, I came across this term largely, and now I can tell you almost everything that you want to know about Bitcoin and “HODL” -ing bitcoin.
Without wasting much time, I will tell you all about Bitcoin “HODL”-ing here. Read the article carefully.
What is HODL?
The actual term is “HODL,” which is misspelled as “HODL,” and it simply refers to buying bitcoin and holding it. The idea of buying bitcoin and holding bitcoin is known as “HODL” in the bitcoin market. But the understanding of “HODL”-ing has to be even more.
“HODL” – Understanding
This term had originated in the year 2013, and the context of this happening was something different. While in January 2013, the price of the bitcoin had fallen to $15, but on the other hand, in December 2013, the price of Bitcoin had risen to $1,100. This is the greatest example of the history of bitcoin; the price of the bitcoin will rise and fall and very unexpectedly. Hence you need to decide when you want to buy bitcoin and when do you want to sell it off. This is why the experts say that you must sometimes hold onto bitcoins for some time so that you let the price rise up.
The flaw in “HODL”-ing
We know that HODL has pros and cons but keep in mind the pros, let’s take a look at the cons of “HODL”-ing. Often Holding Bitcoin can be proved to be wrong. It might happen that you will wait for the bitcoin to rise, then rise higher and higher. But ultimately, it may happen that while you keep on waiting for the price of the bitcoin to rise and it might not ultimately raise enough, then the waiting would be fruitless.
Such mistakes made once or twice could be fine, but if repeated, it can cause a deep mark in your finances. It is very clever of the investors; none of the investors want to invest 98% of the portfolio in Bitcoin. The solution is to balance the portfolio so that the investor does not go through a lot of loss. If you systematically balance your portfolio, then you will get back amazing returns.
Reasons Behind HODL-ing Bitcoin Right Now
If you are not very aware, I will give you the reasons why HODL-ing bitcoin could be profitable right now.
- Bitcoin Halving is Yet to Come
- Your Bitcoin is Safe
I will explain to you the details about Bitcoin “HODL” ing, according to the pointers mentioned above.
Bitcoin Halving is Yet to Come
We just had the bitcoin halving in May 2020, and the price has gone up to 10k, but that is not enough. Currently, the halving means a lot more different, and some small miners are coming up who would be halving the bitcoin whenever they might get a chance.
Your Bitcoin is Safe
Experts Say that right now your bitcoin is really safe. Many of the people get to know about the Bitcoin freezing after having used them for long and do not know what it means. This actually means that bitcoin has been destroyed majorly. But the situation can be possibly avoided if you know how the bitcoin is safe and how it can be kept safe. When you keep your bitcoin safe that is in cold storage, then your keys will also be safe, and then you can easily trade.
HODL is not a bad idea, if you know for how long you should hold the bitcoin and when you should sell off the bitcoin. It is just on you that you will know and you will calculate how to keep your bitcoin safe. If you wish to contradict them, post your comment below.