The Rise of FUD: Lingering in the Shadows to Disturb your Peace of Mind

The DeFI Space might only still be in its teenage years, but its impact has spread wide across the global community. From the inception of Bitcoin in 2008, many innovations and new technology have been introduced by numerous projects in order to continue the growth within the DeFI Space. In this growing space, evolution can sometimes be used to influence decisions in an adverse way by irresponsible parties. So, let’s take a look at the common occurrence of FUD within the DeFI Space and how you can make better decisions.

The Absence of Intrinsic Value creates Room for FUD….

Bitcoin was a revolutionary concept when it was introduced in 2008 as it presents itself as the first successful implementation of the Decentralized Network. It was designed to be a more efficient Payment System due to its limited supply of only 21 million along with the Blockchain technology which provides an edge over the traditional system. Its popularity then grew from the tech space to the global community when it was first traded in 2010.

Certainly, when Bitcoin was first introduced, nobody really knows what the real worth of these new digital assets is as some think it’s a worthless number on a Digital Screen while others manage to convince a pizza store to accept 10,000 of these coins in exchange for 2 pizzas. The Supply of Bitcoin around the late 2010s was clearly huge as enthusiasts were mining it during their spare time but demand was low as Bitcoin still doesn’t have real life adoption.

Digital Asset was a new thing in the early 2010s, so much so that people thought that Bitcoin iwas no different to the points you earn by playing a game. This all changed when Bitcoinmarket was launched on 17th of March 2010, where Bitcoin was first listed at a price of $0.003 and users could exchange $1 through Paypal for 333 Bitcoins on the site. This was the first time a value was defined for Bitcoin, and 13 years later, it has gone through a remarkable journey to reach its peak in 2021. Along with this popularity, Bitcoin also is viewed as more of a Digital Asset than its original framework of a payment system.

With every remarkable achievement, there is always another entity that wants to replicate the same success. Over the years we have seen many DeFI Projects claiming to be the “Next Bitcoin” or “Bitcoin Killer”, disappearing just as quickly as they were introduced. The DeFI Space is currently filled with more than 23,000 projects that aim to have a similar story as Bitcoin but only a few of them have managed to stand out and remain.

It is one thing to claim that your project is the “Next Bitcoin” but it is another thing to study what makes Bitcoin special and expand on its capability. Bitcoin is a revolutionary concept that shapes the whole DeFI Space but its main weakness is a lack of intrinsic value. Unlike its real asset counterpart such as Gold or Oil, Bitcoin’s price is shaped by the trades carried out within the markets which is unpredictable at the least.

FUD Strategy

In this absence of intrinsic value, the trades within the markets are built upon people’s perception and outlook of how the price of Bitcoin will be in the future. This is why “FUD” attempts are a common occurrence within the DeFI community as it can be a powerful tool to influence people’s perception towards a project.

Source: https://coincu.com/95258-fomo-and-fud-tips-avoid-syndromes-in-crypto/

What is FUD, then you may ask? FUD stands for Fear, Uncertainty and Doubt which is a marketing tactic or strategy used against a Digital Asset project. The goal of an FUD strategy is usually to influence someone’s decision to not invest in a particular project or sell off what they already own. FUD, in general, is often used in the Digital Asset industry and financial markets to create tensions and fluctuations in prices within the market that in the end will affect one’s investments decision. These FUD attempts can most of the time have an adverse impact on us as growth in any DeFI Project is a long-term game.

How does an FUD usually work?

As a psychological strategy, FUD perpetrators will always try to pick on any single detail from the DeFI Project that can be turned into false information for the community. This false information/news has no basis in reality and is only used to create mass hysteria/panic in the market to “push” you to sell off the digital asset. Due to this misinformation, you can be led to believe that there is something wrong with the project when in reality the DeFI Project was thriving and you would likely miss out on the growth that was well upon your grasp.

FUD Perpetrators usually carry out this strategy with their own benefits in mind and as they come in many shape or form, here are a few of the main candidates:

1. They are Competitors to the Project: DeFI Space can be a densely concentrated space with more than 100s of projects rising up every single day. In order to stand out, you can either bring out the specialty in your own project or highlight the negative aspect of another project. Competitors may search through the nooks and crannies of the project you are invested in to convince you that their project is better so do keep your research game up.
2. They are Brokers/Traders of Digital Assets: If there is one thing that traders truly enjoy is a fluctuation within the market as they could buy it at a low price and sell it at a high price. From this you may see how an FUD attempt will greatly benefit them? First, as you sell your Digital Assets and prices start to drop, it gives them a golden opportunity to buy it at a discounted low price while selling it later at a premium or higher price. At the end it’s the traders who profit from the gains while you are left with a missed chance so be mindful of your choices.
3. They are Influencers who Dislike Your Project: In the era of social media, information is so widely available that we are likely to be overwhelmed by it. As Influencers become ubiquitous in our daily lives, it boils down to who can churn content the fastest on the internet. These contents are rarely based on facts and instead mostly based on the perception of the Influencer who delivered the content so choose who you listen to over the internet very carefully.

How do we ignore FUD and make Better Decisions?

FUD will always be a common occurrence within the DeFI Space as long as perception remains the key driver of the markets. The thing about Perception is that it is not only built upon the thing you listen or associate to but it is also built upon the knowledge you accumulate. The best way to ignore an FUD attempt is to always Do Your Research so you can make an Informed and Rational Decision instead of an Emotional One.

“Know What You Own. And Know Why You Own It.” - Peter Lynch

Familiarizing yourself with the DeFI Project is an important step that is quite often overlooked as the community continues to chase the next bitcoin. As you know the project, you will learn to separate the facts from the fiction within the community and align your decisions with the right information. As mentioned above, growth in any project will not happen overnight so the key is to find the right potential project for you and wait until your patience starts to materialize.

Source: https://medium.com/veniceswap/what-does-fud-mean-how-does-fud-affect-the-crypto-market-3ad0bd0e5089

It took more than a decade of patience for Bitcoin to reach its true potential so ignoring the FUD attempt is important to achieve your long term goals. Here are some tips to help you spot FUD Attempt to help you make better informed decision:

1. Check the Source of the Information: It is very important for you to check the source of the information that is circulating within the community, does it come from a credible and trustworthy source? The source of the information could give you a clear idea of whether its a legitimate information that you need to pay attention to or just some random opinion that you can ignore.
2. Check the Facts of the Information: Facts are something that will be constant with the real world and cannot be altered so check the facts within the information. Does the information align with the current happening within the Project? If the information does not align with the facts of the project then most likely it is just an opinion that can be ignored.
3. Check the Intention of the Information: One of the things you also need the check is the intention behind the information put out to the community. Was the intention to create mass panic or hysteria? If the intention is to create dislike with the project you are invested in then most likely its an FUD Attempt.

All in all, be very mindful of the information you consume or listen to in the community as not all information put out there is with a good intention. Do Check The Facts and Do Your Own Research so you are not easily influenced by others opinion. Every DeFI Project goes through an up and down cycle

We in Nagaya Technologies Pte. Ltd believe that education is an important part of every HODLers journey within the DeFI Space. That is why we encourage everyone to Do Their Own Research before committing themself to any project. Nagaya is the world’s first hybrid digital asset that is partially backed by Gold to protect its intrinsic value and subsidiary projects to allow its value to grow sustainably over time. To learn more on the latest information on Nagaya and our whitepaper, you can always visit us at www.nagaya.co

Or you can follow us at t.me/nagayaofficial for all the latest updates!