How do retail investors hold onto that pile of garbage altcoins?
Most retail investors are in a situation like this:
- A half-new mindset: They are often those who have just entered the market or made some small profits in the last round, easily forming path dependence and biases, thinking they understand a bit.
- Overly trusting project teams and KOL recommendations: They excessively believe in the project team's 'innovation' and 'future vision', as well as the recommendations of KOLs, blindly following others' opinions without independent judgment.
- Poor timing of purchases: They often buy in when the market is falling, leading to immediate losses. A wave of market decline can easily result in a 20% loss, and after a few times, losses can reach -50%.
Then their mindset gradually becomes anxious and fearful, and in search of comfort, they immerse themselves in the community's 'faith'. They constantly self-soothe, trying to alleviate their inner anxiety through positive energy in forums and group chats.
However, this blind faith often only leads them to jump from -50% directly to -70%.
Finally, when the price continues to fall, they reach a state of 'a dead pig is not afraid of boiling water', believing 'a miracle will definitely happen', and even as losses worsen, they refuse to cut losses, firmly believing that a reversal will come.
This is probably the typical mindset and operational path of retail investors.