Turn NFT FOMO into JOMO
The Joy Of Missing Out
Fear of missing out (FOMO) has been a prominent topic of discussion since the introduction of social media. This FOMO feeling isn’t just a 21st century problem, but now more than ever you have access to see what people are doing and can easily fall into the trap of wanting what others have.
Many people fall victim to this anxiety when investing in financial markets. Highly speculative stocks and markets (i.e. SPACS and The Dot Com Bubble) have lured investors in with the promise of outperforming the market. People see money being made and the greed takes over, typically resulting in retail traders holding the bag when prices slip.
It is true that many people get rich and wealthy off being “early” to new forms of investments and technology. It is also true that I believe Non-Fungible Tokens (NFTs) are the currency of culture and have the possibility of changing the world. But investing with money you can’t afford to lose, making decisions out of fear, and blindly jumping on the next hot topic can have dire consequences. Luckily, there are actionable ways to avoid this and to invest with the Joy Of Missing Out (JOMO) instead of FOMO.
NFT FOMO
NFTs have boomed over the past year. Beeple’s $69 million dollar sale of a digital picture caught the attention of everyone. Profile Picture (PFP) projects such as Crypto Punks and Bored Ape Yacht Club are flexed by cultural idols. Decentralized Finance (DeFi) and tech whales flooded into the market buying up PFP NFTs they thought were the next 100x. Influencers and alpha plugs grew in popularity and helped bring many people fortune. NFT “collecting” has gone from a meme and art culture to a game of what’s next, “wen marketing”, and passive income.
The feelings of greed, fear, and anxiety have reached their peak in NFT investing and need to be addressed. People are investing in NFTs with money they can’t afford to lose and with the hopes that empty promises lead to execution. Twitter and Discord serve as a constant reminder of projects people missed out on or investments they should have sold. Scammers are taking advantage of FOMO and project rugs are being pulled everyday. It is truly the Wild West — and why it is so important to leave fear behind.
Signs of FOMO
- Buying into projects outside your means… If the project ends up failing, there will be real life consequences and the money could’ve been used elsewhere.
- Following investments that others make… It is important to take in as much information as possible to make your OWN decision. Buying into a project because someone else does or only because you received a whitelist spot can be a dangerous game.
- Being envious of others… No matter how successful people may seem or how great they are at making NFT investments, you don’t truly know what their going through. Be happy for others when they make good calls,try to learn from what has made them successful, and implement some of their strategies into yours.
- Being over leveraged in certain projects… The NFT space is so new and being over leveraged in 1 or 2 projects can be risky. This can be done successfully, but make sure you are investing this way with due diligence and know when to get out.
- Constantly checking floor prices… When buying an NFT you should not care when the floor slips. Yes, it is good to monitor and have an idea when to cut losses, but like Warren Buffett says, “Be fearful when others are greedy and greedy when others are fearful.”
NFT JOMO
The benefit of FOMO being prevalent in other walks of life is that people have found ways to combat this fear. Ideas and strategies have to be adapted to NFTs, but the core principles stay the same. Laura Wagg lays out the steps to trading financials with JOMO instead of FOMO.
- Develop a Trading Plan —
With NFTs this comes in many forms. Are you planning for a quick flip or a long-term investment? What is the amount of money you are willing to invest and are okay with losing? What is your exit strategy? How many NFTs of a project are you going to buy? Are you investing in PFP projects or one of one’s? How much research are you planning on putting in before you buy? Are you minting the NFT or buying on the secondary market? Do you buy a floor NFT or buy a more rare one that may cost more?
All of these questions are important to answer before you get into investing and buying NFTs. Having these plans established will help you stay calm in times of uncertainty, because you already have established what you will do. Always remember why you first got into NFTs and
- Keep a Trading Journal —
The advantage of NFTs is that they are on the blockchain and can be tracked. You can always go back and see when you sold and why you sold. I recommend tracking trades in an Excel or Word document — writing down thought processes and why you decided to get out.
Looking back on these trades should not be a time to punish yourself for selling too early or buying too late though. These notes should be used as a log to analyze and find patterns. They should be used as a learning lesson and not as a way to foster regret. My first NFT I minted was a World of Women (WOW) and sold it for a $700 profit two days later. This happened to be a rare WOW NFT and would be valued at roughly $120,000 during the writing of this article.
I could easily look back on this as a mistake and kick myself. But viewing it as learning experience helps me in the future when looking at projects. At the time, $700 went a long way for me and I was happy to take the profits and continue to learn.
- Use Expert, Authoritative Resources —
There are many reliable resources in the NFT world and more come out everyday. Some of these include Opensea Stats, Nansen, Rarity Tools, Dune Analytics, Crypto Slam, etc. These tools allow you to do your own research and find discrepancies in prices. They help you see a clearer picture of what projects are successful or that are trading frequently.
I also recommend staying up to date on current events. Follow large companies within the NFT and crypto space. Also, follow large reputable projects to see how and why they are successful. Building a source of truth helps you trade on your own research and not on other people’s actions.
- Set Processes —
Investing in certain types of NFTs give you a better chance of understanding what will be successful. If you can find a niche that you enjoy even better. An example of this could be focussing solely on Ethereum NFTs. It could even be narrowed down to only investing in anime NFTs, gaming NFTs, or NFT projects that include forms of staking or tokenomics. The better you understand the niche, the clearer you will see through the noise.
It is also important to set daily processes. How often will you check prices? What times will you be logged on researching? When will you listen to AMAs, spaces, or podcasts? Establishing these processes help bring a routine to your life and help prevent irrational actions.
- Listen to Others and Filter the Information —
There are tons of people to follow in the NFT community. There are alpha groups, influencers, and investors. It is easy to find these people on Twitter or in Discords. I believe it is important to take in as much information as possible. Listening to different points of view helps you think in different ways and maybe come to a realization you wouldn’t have before.
That being said, always go back to your own analysis. Don’t rely on what other people are investing in. It is easy to see what famous whales are buying due to the blockchain ledger. But even though a famous or wealthy person buys into a project, you don’t know their true intentions. They could simply be buying the NFT because they think it looks funny. Filter the good information from the bad and don’t let your investment strategy be affected by others.
- Improve Your Trading Psychology —
Investing without emotion is easier said than done. Cryptocurrency is volatile and adding a function of illiquid NFT assets to the mix creates uncertainty. This is why it is important to remember why you got into NFTs in the first place. There are so many benefits to NFTs besides getting rich quick. There are many opportunities to network and learn.
Remember to have gratitude that we even have the opportunity to utilize this technology. When investing make sure you have a calm and clear mind. If you have a stressful day or are feeling out of whack, take the day off from NFTs. I cannot stress the importance of the mental side of NFTs and investing in general.
- Have a Healthy Relationship with Trading —
As consuming and entertaining as NFTs are, there is more to life. Remember to take a step back and appreciate the real world. NFTs can easily consume all your time and energy, so it is important to keep a pulse on how it is affecting your well being.
It is more than okay to take profits, especially if it can help you out in the real world. Mistakes will be made when investing and trading NFTs and it is incredibly important to know this doesn’t make you a bad investor or incompetent. Try to learn from mishaps and be okay with missing out!
NFTDuddette
I want to give a special shout out to NFTDuddette for coming up with this article idea and for giving her perspective on it. NFTDudette is a long time mental health advocate and is now offering NFT life coaching sessions to MMC holders.There is no denying that the NFT space can be overwhelming and you can find yourself getting lost in all the noise.
NFTDudette offers 1 on 1 sessions to all MMC holders to help you learn how to navigate the NFT space. She can help you develop skills that are tailored to your intentions. Making you better prepared and suited for what’s ahead in this space mentally. So you can focus on your goals without feeling overwhelmed, burnout, lost, or feeling like giving up, & of course not letting FOMO take the fun out of your time.
