The term HODL is fairly new but if you’re interested in Bitcoin you will have definitely come across it. But what does HODL mean? Let’s find out
HODL is a funny-sounding word and its genesis and usage are fairly new compared to other internet slang terms. Most internet slang terms, things like NSFW, XOXO, and IYKYK, are often used to shorten phrases or express emotion. But HODL is neither of these things – it started life differently too and evolved to mean more than one thing.
What Does HODL Mean?
The rise in popularity of the word HODL came from Bitcoin. HODL is a misspelling of HOLD, the process of buying and holding onto Bitcoin or other cryptocurrencies. The first instance of the use of HODL was in 2013 inside a post on Bitcointalk, a popular Bitcoin forum.
HODLing basically means to buy something, a stock or some Bitcoin or other cryptocurrency, and then NOT sell it for prolonged periods of time. You buy low, usually, and then hold onto the stock/coins until the prices grow massively. In 2013, it was a tough time to HOLD as the price of Bitcoin was going up too much.
But if you did have some BTC in 2013 and you held onto it, then by 2021 you would have made A LOT of money. The price of a single Bitcoin just hit $40. That’s a HUGE increase in price from 2013 when one Bitcoin cost just over $1000.
During 2013, the price of Bitcoin rocketed from around $100 to over $1100 inside a couple of months, making plenty of early adopters A LOT of money. Providing they HELD their coins, hence the endearment of the word HODL. Since then, HODL has remained popular and is now part of the Bitcoin nomenclature.
The person responsible for the creation of the term HODL was a person called GameKyuubi who posted the following statement on the forum: “I AM HODLING”.
The OP of the post, who also happened to be drunk, was writing about his lack of skills as a Bitcoin trader. He added that he planned to HOLD all of his bitcoin. But his misspelling of the word HOLDING as HODLING is directly responsible for the creation of and the continuing popularity of the word HODL.
How HODL Became A MEME
How do things become memes? No one really knows. Plenty start life on 4chan or Reddit. But HODL started on Bitcoinchat, as discussed above, and it quickly caught on in the Bitcoin and wider crypto communities. Memes were created using the word HODL alongside images from 300 and Braveheart, as well as Hodor from Game of Thrones.
The perfect timing of GameKyuubi’s post, right before the Bitcoin market went berserk, combined with the growing popularity of Bitcoin as a tradable asset, effectively created the perfect meme storm. All the elements were in place and the philosophy of HODL, while not new by any stretch of the imagination entered popular culture.
How Do You HODL?
As investment strategies go, HOLDING or HODLING is almost as old as the stock market. All it means is that you buy something – a stock or some crypto – at a set price, ideally after a big dip, like the recent one earlier this year, and then you hold onto it for the long haul, so if you bought at $28K, you’d hold until it reached $50K or even $100K.
But because Bitcoin is so volatile, the term HODL has now taken on a dual meaning. In one way, it can be used to describe the process of HOLDING onto your coins. In the second, it means HOLDING ON FOR DEAR LIFE. The great thing about this is that they both work extremely well when referring to Bitcoin
Bitcoin, especially if you have a lot invested, can be very scary, so holding while the market is booming is always very, very hard. You never know when the bottom might drop out and it could happen at any time, so if it got to $50K, for instance, and you didn’t hold, and then BTC crashed and it went down to $25K you’d have lost a ton of money.
But there is more to HODL than just hoarding your BTC, as Investopedia notes:
For cryptocurrency maximalists, HODL represents more than a strategy for reigning in FOMO (Fear of Missing Out), FUD (Fear, Uncertainty, and Doubt), and other profit-eroding emotions. Long-term crypto HODLers stay invested because they believe that cryptocurrencies will eventually replace government-issued fiat currencies as the basis of all economic structures. Should that occur, then the exchange rates between cryptocurrencies and fiat money would become irrelevant to crypto holders.
The good thing about Bitcoin – and other cryptos like Ethereum – is that actually buying some is now really easy. You can use PayPal to buy Bitcoin and Ethereum and it literally takes about 10 seconds. Just confirm the amount you want to buy, then select enter, and BOOM you’re now the owner of some Bitcoin.
I recently used PayPal to buy some BTC during the recent crash. I didn’t get a lot but the price of BTC went up almost immediately after, going from $28K (what I bought at) to around $40K inside a week and a half. Many analysts and market-watchers believe BTC could one day hit $100K, although plenty of other experts disagrees.
As always, when it comes to Bitcoin and other cryptos, NEVER invest more than you can stand to lose. And always buy on a dip or during a crash. That way, you’re maximizing your potential gains. And if you’re a beginner, always start small. Don’t go putting your entire life savings into BTC. Start with a $100 here and a $100 there and see what happens.
Or, take a course on how to buy and sell Bitcoin – it always pays to understand the market you’re entering into.
Richard Goodwin has been working as a tech journalist for over 10 years. He is the editor and owner of KnowYourMobile.
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