Cryptocurrency5 hours ago (Dec 11, 2021 11:30AM ET)
3 Psychological Tricks to Endure Crypto Flash Crashes
As cryptocurrency investors, we’re all pretty used to the volatility and double-digit ups-and-downs that come with the space. However, 20% flash crashes in a single day – as we saw happen on Saturday – can rattle even veteran digital investors.
While there are many traits that can help during those difficult situations, the one essential trait to endure through downturns is mental toughness. Fortunately, the ability to endure and persevere through overwhelming circumstances is a critical skill that anyone can start developing today by using these three common sense tips.
1. Decide what you WON’T think
There’s an ancient proverb that states, “As you think, so you are.” Many self-help gurus spin that into the power of positive thinking and proactive optimism.
That’s all good, but it’s equally important — and usually easier — to identify negative thought patterns you’ve had in the past and then choose not to engage in those again.
For instance, if you’re prone to thinking the worst outcome will occur, choose to take a wait-and-see approach instead. If you think you’re the only one who can save a project and that thinking causes you undue stress, decide to delegate to others. If you think a team member is trying to sabotage you, have a conversation to clear the air.
You dictate your thought life, so be intentional about avoiding negative thoughts – like all your crypto investments will go to zero – which can undermine your mental toughness.
2. Build mental momentum
Mental toughness can wane when you’re stuck in a rut or experience repeated crypto market declines. The best way to break that inertial immobility is to achieve a small win for yourself and then build on it. It can be anything. Commit to call a new client, pay a bill, meet a colleague for lunch, clear out your email inbox — just do something, it doesn’t have to be connected to crypto.
Write down what you decide to do, then check it off once it’s accomplished and repeat the process to build momentum and create a virtual flywheel of positivity. Focusing on non-crypto activities during a digital asset crash, can help reboot your outlook and perspective.
This is a doable way to build a series of concrete successes that can advance you through adversity when everything seems to be falling apart. Intentionally making success a habit can empower you to focus beyond the current situation, build confidence in your ability, and develop mental toughness.
3. Channel your role model
Lastly, pick someone that you believe embodies mental toughness — it could be an inspiring relative or neighbor who survived cancer, resurgent tennis star Serena Williams, maverick Tesla (NASDAQ:) CEO Elon Musk, or founder Charles Hoskinson – or whomever.
Then, learn about your respective role model so you understand the thinking, anchoring beliefs, motivations, and perceptions that make them who they are. Strive to gain as much insight into their psyche as you can and then mimic it within your own life every chance you get. Understanding how others successfully navigate through adversity can equip you with similar skills and help fasttrack your own path toward mental toughness.
These three actionable steps can help you overcome some of the challenges we all face during flash crashes as crypto investors.
On The Flipside
- There’s another ancient saying that states, “Confession is good for the soul.” One of the best things someone who’s struggling with worry or depression can do is to find a support group to talk through their internal struggles.
- Alternatively, some counselors view constant cryptocurrency trading as an addiction similar to gambling and treat it the same way using a 12-step program.
Why You Should Care?
Life balance and proper prioritization of what’s really important (e.g. health, marriage, family, children…etc.) can help provide grounding and comfort in the face of material loss. Finances can be replaced – those other priorities cannot.
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