What Does HODL Mean in Crypto?
HODL means to hold your assets for an extended period, refusing to sell them even when there’s an increase or decrease in the market price. This is also referred to as a “buy-and-hold” strategy.
Some crypto investors have taken HODL to mean “hold on for dear life.” It’s considered a type of long-term, yet passive investment strategy for cryptocurrencies. The term itself was derived from a misspelling of the word “hold.” It first became popular when a user named “GameKyuubi” made a spelling mistake on an online Bitcoin forum, BitcoinTalk. The user created a thread entitled “I AM HODLING,” explaining their reason for “hodling” their trades.
Since then, HODL has become a popular crypto investment strategy for users who consider themselves terrible at making short-term trades. This expression has inspired many back-formed terms, such as BUIDL, which refers to the creation of various applications in the industry.
Aside from that, many investors opting to adopt a HODL approach toward their trades do so because they believe that digital currencies will eventually replace fiat currencies — and that HODLing their assets could potentially lead to value appreciation in the long run.
HODLing assets can also provide investors with additional safety against the market’s short-term volatility, since they’re less likely to experience buying high and selling low. It’s considered a more straightforward way to gain profits on digital assets.
Beginners are the ones most likely to profit from this type of crypto strategy, because they can still earn from their investments while having enough time to explore other aspects of the industry.
However, the strategy has some downsides as well, particularly in terms of the time frame. Investors can miss out on profiting opportunities in the short term by HODLing their coins, as they’ll need to wait longer to reap the profits from their investments.
HODL Coin in Crypto
The popularity of HODL among the crypto community also inspired a cryptocurrency named after it: the HODL coin. This token was built on the Binance Smart Chain, and is backed by a solid DeFi community.
The HODL coin is also based on the principle, or strategy, it was named after, since a token’s value is supposed to appreciate with time, even without investors swapping or trading it.
Aside from that, token holders can also earn additional daily Binance Coin (BNB) rewards by holding HODLs in their crypto wallets.