What is HODL? All you need to know

"HODL" is a term originating from a misspelling of "hold" in the context of buying and holding Bitcoin and other cryptocurrencies. It's also interpreted as "hold on for dear life" by crypto investors. The term emerged in a 2013 post on the Bitcointalk forum during a period of Bitcoin price volatility, encouraging holders not to sell despite fluctuations.

Understanding HODL

At 10:03 a.m. UTC on Dec. 18, a Bitcointalk forum user named GameKyuubi posted a somewhat incoherent and typo-filled rant while purportedly drunk, admitting to poor trading skills and declaring an intent to hold onto his Bitcoin. Despite his shortcomings as a trader, he emphasized the decision to hold rather than sell during market downturns, suggesting that only skilled traders profit from market highs and lows. This post quickly turned into a viral meme, with references initially to epic battle movies like 300 and Braveheart, spawning numerous HODL-themed memes across the internet.

HODLING: Strategy and philosophical approach

HODL, derived from "hold on for dear life," has become a mantra among cryptocurrency enthusiasts symbolizing a long-term investment approach. This mirrors GameKyuubi's original rationale that novice traders often fail to time the market and should simply hold onto their coins.

For cryptocurrency maximalists, HODL signifies more than a strategy to resist emotions like FOMO and FUD that can erode profits. Long-term HODLers remain invested because they believe:

• Cryptocurrencies will eventually replace fiat currencies, making exchange rates with fiat irrelevant to crypto holders.
• Cryptocurrencies will increase in value due to this potential shift, leading to substantial wealth.

A meme vividly captures this maximalist philosophy: In a scenario reminiscent of The Matrix, Neo asks Morpheus if he can trade Bitcoin for millions someday. Morpheus replies, "No, Neo, I'm trying to tell you that when you're ready … you won't have to."

The enduring practice of HODLing

According to these principles, the optimal time to HODL is perpetually. A dedicated adherent would retain their tokens indefinitely, even during market crashes or extreme volatility. HODLing transforms into an ideological conviction regarding the future potential of blockchain technology, cryptocurrencies, and their associated communities.

Other cryptocurrency slang and terms

In addition to HODLing, the cryptocurrency community embraces various acronyms and expressions, often accompanied by emojis, akin to meme stock communities. Here are some examples:

• FUD (fear, uncertainty, doubt): False or negative information about crypto that true believers ignore.
• FOMO (fear of missing out): Joining trends hastily rather than missing potential gains.
• Diamond hands: Holding onto crypto steadfastly, even during market downturns.
• Hold the line: Encouragement to maintain strong positions during market volatility.
• Paper hands: A term criticizing those who sell crypto too quickly, seen as lacking conviction.
• Mooning: Describing a sharp rise in crypto prices.
• Apes: Community members, possibly originating from memes or collective action against financial elites.
• BTFD (buy the f***ing dip): Strategy of buying crypto after price declines.
• YOLO (you only live once): Justification for taking risky crypto investments.

These terms reflect a blend of humor, resilience, and speculative enthusiasm within the cryptocurrency sphere.

Holding assets: Beyond cryptocurrencies

While "HODLing" is commonly associated with cryptocurrency investors, the strategy of buying and holding assets applies broadly, including to stocks. Stock investors often employ a long-term hold strategy, benefiting from price appreciation with comparatively lower volatility than crypto markets.

Additionally, "HODL" also refers to a DeFi token on the Binance Smart Chain (BSC) known as HODL Coin (HODL/$HODL), launched in May 2021. This token incentivizes users to retain their holdings to earn rewards in Binance Coin (BNB) distributed every three days. These rewards are funded by transaction taxes, with a portion of the taxes converted into BNB tokens and redistributed from the liquidity pool to users.