Crypto Fud – What It Is and Why It Exists

Reading Time: 3 minutes
  • ‘FUD’ stands for ‘fear, uncertainty, and doubt’
  • Crypto FUD usually comes in the form of institutions or high powered individuals laying into Bitcoin
  • FUD is often orchestrated by whales and powerful financial players to artificially drop the price so they can accumulate more

‘FUD’ is a term that everyone who has been in the space for any length of time will have come across, and may even know what it means. Often however, FUD runs deeper than just bad news or a negative opinion – it has a clear purpose behind it. But what exactly is crypto FUD, who puts it about, and why?

Fear, Uncertainty, and Doubt

‘FUD’ is an acronym for ‘fear, uncertainty, and doubt’, and is the process by which bad news or negative opinions are published, usually by mainstream media, about a company, asset, or asset class. What is reported can sometimes turn out to be light on truth, or sometimes sheer fabrication, but its purpose is not to inform but to cause concern among holders connected to the company or asset.

What is FUD?

Examples of FUD can include powerful individuals making disparaging comments about an asset, or an institution releasing a negative report or opinion piece on an asset or asset class. We have seen this time and time again with Bitcoin, with mainstream media and institutions causing crypto FUD by battering it from pillar to post over the years – a classic example is the threat of a ‘China Bitcoin mining ban’ which is wheeled out whenever it is deemed useful.

Who Benefits From FUD?

So who benefits from FUD? Sometimes negative opinions are just that (for example, Peter Schiff) and reports are truthful, but often there is a controlling hand behind how the campaigns of negativity are orchestrated, and that hand belongs to institutions who are powerful enough to control the flow of information to the masses.

A chart from one of our interviewees, Super_Crypto, neatly summarizes the impact of institutions in creating crypto FUD in particular:

bitcoin fud chart

Source: Super_Crypto/Medium

Institutions weren’t interested in Bitcoin for many years, but since 2016 they have been far more evident in the space, which has coincided with this raft of carefully placed negativity. Wall Street likes buying things for a discount, and having seen the kinds of profits that can be made with Bitcoin following the 2017 bull run, they have spent much of 2018 and 2019 helping to push the price down by over 80% by making sure that any bad news about crypto and Bitcoin is magnified and given great exposure.

Once the hand grenade is launched, whales trigger a sell off, which scares regular holders and causes a cascade of selling. And who is there waiting to buy the Bitcoin back at the lower price? The same whales and institutions who triggered the move.

FUD Isn’t Just For a Bear Market

Bitcoin has been going through a slow and steady accumulation phase in the past two years, with a couple of pumps in between, but each time a full scale bull market has been resisted. And now, after two years, what do we see? Major banks and hedge funds are publicly coming out in support of cryptocurrencies. What a surprise. It seems that they have done their accumulation and are now ready to help boost the price and make some profits.

Don’t be surprised to see some more crypto FUD on the way up as well as the way down – big players sell and re-accumulate at key points in all markets. The key thing is to analyze the message behind any news that comes out and see if it is likely to impact anything in the long term.

Bitcoin has come through torrents of bad news over the years, so much so it’s almost impervious to it, and there are so many parties interested in its price going up that almost anything that appears in mainstream media regarding Bitcoin is done with a very clear purpose in mind.

And if in doubt, just HODL.