A client messaged me before Bitcoin’s last rally and said something honest: “I feel like I’m missing out. Should I buy?” He was nervous about FOMO. He wanted to avoid emotional decisions. I told him FOMO is real, but the issue is more nuanced than that.
Let me separate the genuine problem from the emotional distraction, because they’re not the same and conflating them costs people life-changing money.
FOMO-Driven Buying Is Bad
First, let’s be clear: FOMO as a trading signal is terrible. If you’re buying Bitcoin because everyone at the dinner party is talking about it, or because you see a tweet about someone’s gains, or because the price hit a new high, you’re doing it wrong. FOMO-driven buying peaks at market tops. Most people who buy purely on FOMO buy near the peak and hold through massive drawdowns. That’s how you lose money.
The data on this is brutal. In 2017, Bitcoin rallied from $4,000 to $19,000. Most new buyers entered in the last month, near the peak. By 2018, Bitcoin fell to $3,600. Most of those FOMO buyers were underwater 80 percent. They got emotional, they panic-sold, they locked in losses. FOMO trading is a losing strategy.
I’m not arguing you should FOMO-buy. You shouldn’t. FOMO is emotion and emotion makes poor allocation decisions.
But FOMO Is Pointing at Something Real
What FOMO is actually detecting, underneath the emotional noise, is a real structural fact: you may be underweight a genuinely important monetary transition.
Bitcoin isn’t a company. It’s not a stock. It’s a monetary network. Saifedean Ammous framed it in “The Bitcoin Standard” and Gigi expanded on it in “21 Lessons”: Bitcoin is potentially a new form of money emerging in a world where all existing money is being debased. That’s not hype. That’s a structural argument.
The question isn’t whether Bitcoin Will go up tomorrow. Nobody knows. The question is: am I allocated appropriately to a monetary transition that’s happening in real time? That’s not FOMO. That’s prudent diversification.
If Bitcoin becomes what its proponents believe, a genuine store of value that functions outside state monetary control, then being uninvested is actually a mistake. Not because the price will go up, but because your monetary wealth isn’t protected. That’s the real anxiety underneath FOMO.
Timing vs Time in Market
Here’s the brutal data point: people who waited for Bitcoin to “calm down” or “get cheaper” have consistently cost themselves enormous sums of money.
In 2018, when Bitcoin crashed to $3,600, everyone said “I’ll wait for it to calm down and then buy.” Bitcoin then went to $60,000. People who waited for it to “calm down” at $3,600 never actually bought. They waited for cheaper, and they watched it climb from $3,600 to $20,000 and then they got FOMO’d and bought at $19,000. That’s exactly backwards.
In 2020, when COVID crashed Bitcoin to $4,000, financial advisors told clients “Avoid it, it’s crashing in a panic.” Bitcoin bounced to $60,000 by 2021. The people who waited for stability never got stable prices. Prices never came back to $4,000. They only went up.
The strategy of “I’ll buy when it’s calmer” is a strategy of “I’ll buy never.” Because volatility doesn’t go to zero. Bitcoin is always going to have drawdowns. If you’re waiting for a drawdown where you feel completely safe, you’re waiting forever. By the time you feel safe, the price has moved and you’ve waited.
The research on time-in-market versus timing-the-market is overwhelming: time in market wins. If you’d invested in Bitcoin at the absolute peak of every bull cycle, $1,000 in December 2013, $19,000 in December 2017, $69,000 in November 2021, you’d still be profitable today. Not spectacularly, but positive. The four-year holding period protected you from bad timing.
The South African Context
South Africa offers a concrete case study of this. South Africans with foresight who allocated Bitcoin early, 2018, 2019, 2020, have genuinely life-changing wealth. Not because they’re rich or lucky. Because they acted when assets were cheaper and they held through the volatility.
Contrast that with South Africans who waited for the “right time” to get into international diversification and never did. The rand fell 70 percent against the USD over twenty years. They didn’t diversify. They waited for stability. The stability never came. The USD got further away. They got poorer.
This isn’t theoretical. South Africans who bought Bitcoin at R60,000 per Bitcoin in 2020 are now up significantly in rand terms. Not because they timed the market perfectly. Because they had a four year holding period and Bitcoin went up. That’s time in market, not genius timing.
The Actual Question
Here’s what I’d ask instead of “Should I buy Bitcoin because of FOMO?”
First: Am I appropriately diversified out of my home currency? For South Africans, this is urgent. Rand debasement is real. Diversification is not optional. Bitcoin or otherwise, you need non-rand exposure.
Second: If Bitcoin becomes a genuine monetary reserve asset, what’s an appropriate allocation for my situation? 1 percent? 5 percent? 10 percent? That’s a deliberate question, not an emotional one.
Third: Do I have a time horizon of four years or more? If yes, history suggests the timing risk is low. If no, maybe Bitcoin is too volatile for you. That’s fine. Not everything is for everyone.
That’s a sensible allocation framework. FOMO is not. Waiting for stability is not.
The uncomfortable truth is that the people who are nervous about Bitcoin right now are probably nervous because they waited and now Bitcoin is higher than they expected. That anxiety is backward-looking. What matters is whether you’re appropriately positioned going forward. That’s hard to think about clearly when you’re emotional about the price you should have bought at.
FOMO is pointing at a real problem: you may be underweight an important monetary transition. Address that problem deliberately. Don’t address it with emotion. Allocate rationally. Set a timeframe. Stop watching the price. You won’t regret it.
