What is Crypto FOMO & How to Avoid it

By Nicholas Rossolillo – Updated Feb 25, 2025 at 10:50 PM

Key Points

Interest rates rose in 2022, negatively impacting cryptocurrencies and high-growth stocks.
FOMO drives investors to risky, high-growth assets without understanding the risks.
Avoid FOMO by focusing on long-term investing and understanding your goals.

2022 took a drastic turn for the worse for investors of all types. After a period of accommodating monetary policy from the Federal Reserve, interest rates are being raised to fight inflation. The good times are over (for now) for risky assets such as cryptocurrencies and high-growth stocks.

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About the Author

Nicholas’ investing experience began when he opened up a retirement account shortly after finishing high school. His work experience in financial services began in 2007 in an internship position with a national brokerage firm in Arizona. While his career path led him into civil engineering and related fields, he stayed personally involved and active in the investment realm. He eventually returned to a career in investments and financial services in 2012, running a branch office for the same national brokerage firm, this time just outside of Spokane, WA. During the Great Recession, he began developing a flexible and global investing approach that could evolve with a tumultuous and ever-changing world. Wanting to offer that approach to investment management to his clients paired with a financial planning and consulting business, he founded Concinnus Financial in 2014. Nicholas grew up in a small town on the Northern California coast just a few minutes from the Oregon border. Growing up in a rainy, quiet little town, he developed a love of music and can play several instruments. He now lives with his wife Kasey and their two Humane Society-rescued dogs. Together they enjoy the outdoors all four seasons of the year, cooking, and craft beer and wine.

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2. Focus on goals, not simply making money

Having money for the sake of having money doesn’t make a lot of sense. What is the money for? In other words, what’s your plan? Saving and investing has a purpose, from preparing for a big purchase (car, home, etc.) to planning for retirement (or a “work optional” period in life).

Before dropping some coin on a money-making scheme, do a mental walkthrough on the purpose for making the money. Or, better yet, write your goals down and read them again. FOMO could lead to a boom-or-bust investment. Perhaps a very small portion of your money is appropriate for such a decision, but imagine a scenario where a large portion of your investment loses value. Then ask yourself if this is an acceptable outcome for what you’re trying to accomplish. If you’re saving for a shorter-term goal, you might want to take a hard pass.

If the goal is longer term, a big price swing to the downside might be fine. In fact, expect this to happen frequently with any investment. Still, actively thinking about investments going wrong and whether that matches your objective is an important step in risk management and avoiding FOMO-driven decision-making.

3. Build a portfolio, not a collection of hot tips

As previously mentioned, incorporating a small percentage of your investments into higher-risk but potentially higher-return investments might make sense for you -- especially if you have many years or even decades to go before you need the money. However, avoid the desire to put together a portfolio of “hot tips” you find on social media or collect from your peers.

Instead, build a portfolio of quality investments built on a long-term thesis. Think growing and profitable businesses benefiting from secular trends rather than short-term fads. Once you’ve put together a core group of holdings, then consider adding in some more speculative growth investments that might be able to build a durable business model over time.

What is Crypto FOMO & How to Avoid it