From the first days of crypto currencies they have been subject to ridicule as being just a game for computer nerds, cyber punks, etc. This lack of belief coupled with the “Wild West” nature of the new developments meant that they were volatile from the beginning.

Volatility in the crypto world is like volatility in financial markets multiplied by a factor of 10. At least.

This volatility makes for exciting times allowing people to make profits (or losses) very quickly just by trading in and out of various coins. I believe that the word HODL was coined in 2013 by a trader who mistyped that he was going to hold some coins even though they were dropping. It has also be renamed as “hold on for dear life”, which represents the difficult choices in crypto trading.

If you HODL you could get a massive gain (100X or more) or you risk losing virtually all the value. This is why one of the common trading practices is to invest, sell at a profit while the price is rising and then HODL the rest. This way you are able to get your capital back while still keeping some for the big rise.

Don’t forget that HODLING alone may bring you an increase in value but it doesn’t give you any profits along the way.

The volatility is still with us, something that can easily be seen through today’s drop in the value of Bitcoin by over 20%. Just imagine any other form of money that could drop 20% in a day and then bounce back soon afterwards. Obviously I don’t know what’s going to happen, but I feel confident that there will be a rebound.

So, should I sell now and make some profit, or should I HODL in the hope of a rise?