HODL
Crypto slang (originating from a typo of "hold") for a strategy of holding cryptocurrency long-term regardless of market swings.
Where the word comes from
The word came from a typo in December 2013. A user on the Bitcointalk forum posted under the heading “I AM HODLING”, explaining that after a price drop he was not going to sell anything because he traded worse than professionals anyway.
The typo caught on and later acquired the reading “hold on for dear life”. That is a retrofitted expansion, not the original meaning.
Behind the joke is a substantive idea: most retail investors lose to the market not through poor asset selection but through attempts to time entries and exits. Declining to try is a deliberate strategy, not passivity.
How this differs from doing nothing
- The asset was chosen in advanceThe strategy assumes you understand what you hold. Holding a coin you know nothing about is not a strategy but a hope.
- The position is sized so it can be left aloneIf the amount is such that a halving forces a sale, the strategy will not survive its first drawdown.
- There are conditions for reviewA protocol exploit, a team walking away, a change to issuance rules are reasons to revisit. Refusing to react to facts is stubbornness, not discipline.
- Custody is thought throughA long horizon raises the cost of a custody mistake. Holding a multi-year position on an exchange is a separate risk, unrelated to price.
What to watch for
The approach has been tested on bitcoin and ether, which have years of history and a working network. Transferring it to any coin mechanically does not work: of the thousands of projects alive in 2017, only dozens survive in any meaningful form.
The second limit is time. The approach is built for years rather than months and requires that the money genuinely is not needed in that span. Committing next year's funds this way guarantees facing a decision at the worst moment.