Bitcoin millionaire here, Bitcoin millionaire there. One bitcoiner’s life seems exciting and one all-time high follows another. How many Lamborghinis should you buy and when do you fly to the moon for the first time? Everyday questions of a bitcoiner.
However, this is an image that is rather drawn by the media. A bitcoin investment is anything but relaxed. An investment in crypto currencies is highly risky and can result in total losses.
Information processing as Bitcoin Trader
On the one hand, there is a lot of information about Bitcoin that is constantly changing. Not only the price changes every minute, also the technical innovations, dangers and suppliers, which are still considered today as good and safe, can already be uncertain or dangerous tomorrow.
And Bitcoin is just one crypto currency of over 1624 digital currencies that Coinmarketcap currently lists. You have to actively participate in the crypto world to absorb this information as well as possible. And even that is not enough to process all the information. When you think you have understood Bitcoin Trader something, you come across the next problem.
This makes Bitcoin & Co. a Sisyphus task: a tiring activity with no foreseeable end. This fatigue leads to stress and possibly despair, because although it is fun to understand the little riddles of the crypto world, it can sometimes be a bottomless pit.
Day trading | Dependence, working time & losses
Day trading seems attractive, fast profits are possible and you feel alive. Dopamine is released and one is quickly addicted to this feeling. Psychologists and doctors are convinced that gambling addiction is as addictive as classical drugs: Nicotine increases dopamine levels by 200 percent, cocaine by 400 percent and amphetamine by 1000 percent.
With crypto currencies, this intoxication – but also dependence – should be faster and easier to achieve due to volatility. Day traders are looking for the next kick – preferably in the form of a successful trade.
To increase Bitcoin Profit
To increase the dopamine dose, the amount of money that is set is increased. The body quickly gets accustomed to the feeling of intoxication and finally a limit is reached that can no longer be increased with higher amounts of money. And as soon as trading stops creating a feeling of happiness, many slip into depression.
The amount of activity of a day trader is often underestimated. Day trading is a full-time job and you have to keep an eye on what’s going on. If traders miss relevant information by a few minutes, this can lead to considerable losses. In addition, traders Bitcoin Profit must sort information that appears minute by minute on Reddit or Twitter and classify it as relevant or less relevant.
But „living at the limit“ is only one aspect of day trading that can lead to stress and strain. Most day traders are also quite unsuccessful.
A study examined the statistics of 83,000 traders who made at least three trades within a given period with eToro – CFD Broker for Crypto Currencies. It turned out that 79.5 percent of traders lost money and on average the loss was 36 percent of the account.
Another study concludes that up to 86 percent of traders fail in the first year. This is mainly due to the lack of expertise and risk management. Larger losses in turn have an effect on the mind.
Losses lead to depressive mood
Hopkins College researchers have found that sudden and significant losses can negatively affect the psyche. This study examined the 2008 bank crash, which showed that those who suffered greater losses experienced at least a temporary increase in depressive feelings and an increase in the use of antidepressants.
This should probably also apply to crypto currencies. However, somewhat weaker, as the crypto market is volatile and even if Bitcoin collapses strongly, this is nothing surprising. In addition, the market usually recovers relatively quickly.
Winnings = Luck?
Not only losses can lead to depressive moods. Life-changing gains can also have a negative impact on mood. Psychologist Martin Seligman of the University of Pennsylvania, for example, found that the great luck of lottery winners lasts just three months.