The HODLer’s Guide
Main Takeaways
On December 18th, 2013 – HODL was born. It originated as a typo of the word "hold," used to describe the strategy of holding your cryptocurrencies instead of selling them.
As we mark the ten-year anniversary of HODL, it's worth noting how this approach has evolved. Tools like the Binance Web3 Wallet, Auto-Invest, and Simple Earn can enhance your strategy. These services offer security for your assets, automate the buying process, and enable your crypto to generate passive income.
Put your idle assets to work, and boost your holdings. Earn crypto while HODLing. Up to 2,000,000 USDT worth of rewards available. It’s time to HODL & Earn with Binance!
While HODLing has proven successful for many, it’s not suitable for everyone. Users should base decisions according to their financial situation and risk tolerance.
Learn the art of HODLing, from the experts at Binance.
The Story Behind HODL
The first usage of HODL traces back to a December morning in 2013, a tumultuous time for bitcoin, which had seen its price crash after peaking a little over $1,100.
In an online forum post titled: “I AM HODLING,” user GamerKyuubi acknowledged his poor trading skills along with his intentions to hold his bitcoin. He encouraged others to “HODL” – not sell their bitcoin – even amidst the bear market.
HODL, or “Hold on for Dear Life,” quickly became a widespread meme in the crypto community – a testament to persistence, determination, and the spirit of never giving up. As we see it today, the HODL mindset is now a widely-adopted strategy among individuals who, due to their limited trading skills, prefer holding their assets over the long term.
What is the HODL Strategy?
The HODL strategy is quite straightforward and not unique to the crypto market:
Buy an asset, or multiple, and hold.
Don’t sell, even if the price goes up or down.
The logic behind HODL is to ignore short-term price changes and focus on the long-term outlook. It’s by no means a revolutionary concept, but the strategy still requires a certain level of careful planning and thought. In other words, don’t jump straight into the crypto market and go on a buying spree.
For those looking to HODL, or already HODLing, we’ve packed everything you need to know in this comprehensive guide. We’ll start with the basics, like how to pick the right coins, and progress to advanced products designed to enhance your portfolio.
1. Pick the Right Cryptocurrencies
Base your decisions on in-depth analysis. Only buy a cryptocurrency because you believe in the project, its team, and its mission.
We understand crypto is intimidating. The jargon and technology is complex; however, don’t pick a coin because you saw a funny meme or a “Twitter expert” told you its price will go up 100x in a few years.
Always do your own research (DYOR). Know what you’re putting your money into.
A good starting point is Binance Academy, an educational platform packed with articles and free courses on topics related to crypto and blockchain. Here, you’ll find guides to investing along with detailed reports on hundreds of cryptocurrencies, including popular coins like bitcoin and ether (ETH). Take your time to read through each article before making your first purchase.
2. Buy Your First Crypto
You’ve nailed down your list of cryptocurrencies, now it’s time to buy. Binance offers a variety of payment channels, including bank transfer, credit/debit card, or directly from other users via a peer-to-peer marketplace. Check out the following FAQ guides to learn more:
As a word of advice, only buy an amount you can afford to lose. The crypto market is volatile and prices can fluctuate rapidly. Even the best traders experience outsized losses.
3. Store Your Crypto in a Safe Place
Next step, picking the right wallet for your assets. You’ve got several options to choose from. Your basic account wallet is the most convenient. Binance handles your wallet’s key; however, you won’t have full control over your funds like a self-custody wallet.
Self-custody wallets mean you are fully responsible for managing your own keys and crypto. If this sounds like something up your alley, consider trying the Binance Web3 Wallet. It’s a self-custody wallet built into the Binance platform, ensuring that while you HODL – you're doing so in a safe and trusted environment.
Compared to its counterparts, which are often clunky and confusing, Binance Web3 Wallet only takes a few seconds to set up. Instead of seed phrases, a set of 12-24 words that acts as your wallet’s master keys, we’ve secured the Binance Web3 Wallet using advanced MPC technology.
Once you’ve settled on your wallet, consider giving Binance’s auto-investing tool a test run or put your crypto to work via an array of passive income products.
4. Stay in the Market
Make regular contributions to your portfolio as you HODL. With Auto-Invest, create a plan that automatically buys crypto based on your preferences. You pick the amount and how often.
For example, you can set Auto-Invest to buy $20 worth of bitcoin for you every month. Updating your plan only takes a few clicks, whether to pause, cancel, or adjust the frequency of your purchases.
5. Earn Daily Interest as You HODL
Grow your crypto portfolio through interest-generating services on Simple Earn, for hundreds of different tokens available on Binance.
The process is straightforward. There’s no trading, buying, or anything complex involved. Browse through our selection and select a plan with terms that work for you, then sit back while your crypto generates passive income.
Note that certain plans allow you to withdraw your earnings anytime (Flexible Products), while others require a locked-in period (Locked Products) for your funds. Make sure to carefully review the terms before subscribing to a plan.
Is HODLing a strategy I should follow?
Remember: the people who HODLed since 2013 shouldered years of heavy losses before their crypto ultimately paid off. The HODL strategy is not suitable for everyone. Understand your own financial situation and risk tolerance before buying crypto.
Your financial situation may require you to sell your coins when prices are up or if you’ve taken too heavy of a loss. Certain cryptocurrencies – particularly smaller, more volatile ones – are less than ideal for a HODL approach.
Keep Calm and HODL on
Binance has all the tools and resources you need to HODL, from secure, user-friendly storage to passive income plans for your crypto holdings. If you’re new to Binance, take your first step by creating an account and completing account verification.
Binance is also celebrating the 2024 Bitcoin halving event by sharing up to 2,000,000 USDT worth of rewards on Binance Earn. Look out for our HODL & EARN campaigns every month till the next halving, and become a true crypto HODLer!
And one final word for the people new to the world of crypto – HODL is more than just a strategy for the crypto community. It’s a philosophy, a mindset to stay resilient towards one’s goals, no matter the hurdles that appear along the way.
Further Reading
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Risk Disclaimer: Cryptocurrency prices are subject to high market risk and price volatility. You should only invest in products that you are familiar with and where you understand the associated risks. You should carefully consider your investment experience, financial situation, investment objectives and risk tolerance and consult an independent financial adviser prior to making any investment. This material should not be construed as financial advice. Past performance is not a reliable indicator of future performance. The value of your investment can go down as well as up, and you may not get back the amount you invested. You are solely responsible for your investment decisions. Binance is not responsible for any losses you may incur. For more information, please refer to our Terms of Use and Risk Warning.