Media Psychology And The Emotional Rollercoaster Ride Of Bitcoin Twitter
This is an opinion editorial by Thierry Berger, a graduate of The University of Applied Sciences in Business Administration Zurich, based on his thesis “Bitcoin: How Social Media Influences Private Investors In Their Actions.”
A friend introduced me to the basics of Bitcoin years ago. I couldn’t believe my eyes when I looked at the price increases over the past few years after our conversation and I wondered: Will this alternative currency continue to rise in value, or is it a big Ponzi scheme that will soon collapse in on itself?
I started to read up on the subject and quickly realized that the influencers on Twitter were often playing with the emotions of their audiences — with fear and greed, to name the most common ones. I could hardly believe some of the exaggerated posts, and yet they drew me in.
It was obvious to me that social media influenced private individuals in their actions when it came to Bitcoin. In my studies, I learned about many theories and models in media psychology, which I can apply to the Bitcoin market and which might help others do the same.
Media Psychology Concepts And Bitcoin Twitter
The uses-and-gratifications theory assumes that recipients choose the medium that can best satisfy their needs. Depending on the medium, a person seeks information, entertainment, personal identity (reinforcement of one’s own values) or integration and social interaction (exchanges among like-minded people). For me, I mix all four motives right away.
The involvement concept, which suggests that a recipient can still be involved with the content of an article even days after reading it, if that person is directly affected by the developments or the views represented. However, this does not mean that attitudes can be permanently changed. The more involved a judging individual is in a topic, the less he or she can be influenced by persuasion from other opinions. The interplay between the emotions of greed and fear and the resulting experienced tension diminishes over time and with experience.
In my environment, everyone, without exception, has confirmed this phenomenon. After your first bitcoin purchase, for instance, you are susceptible to being easily manipulated. With every additional hour that you deal with the matter, your opinion becomes stronger. You may accept price distortions more and more easily and, in the meantime, see the incentive to buy sats at a lower price.
Remaining mindful of why you are on Bitcoin Twitter in the first place, and how the content there is impacting you, will help you navigate it.
How To Handle Bitcoin Twitter
The enormous price gains are, in my opinion, the strongest narrative that draws retail investors into the bitcoin market. The most common type of posts that I see on Bitcoin Twitter are positive price forecasts. These generate clicks, have the potential to trigger fear of missing out (FOMO) and entice private investors to make rash purchases.
How strongly an individual reacts to information with positive connotations, or to information with negative connotations in a phase of strong price decay, and whether an action results from this, ultimately depends on the motive and the experienced emotions of a recipient, as well as the behavior of the influencers consumed. But the natural human trait of being guided by emotions means that new investors could pay the highest prices at the end of an upswing and sell these positions at losses when prices correct, in fear of a total collapse. This is why anyone entering the Bitcoin space this way should keep in mind the psychological factors at play.
One suggestion I have is to remain strong-minded. If someone’s investment goes into the red, their mood usually dips. But losses and gains don’t materialize if you don’t cash out. But I believe that four out of five people don’t hold to this, emotionally. That’s where you have to be tough as nails. There is an age-old wisdom that should be drilled into every private investor: You can never catch two things, the top and the bottom. “Simply doing nothing” is historically best in a market that is going up in the medium to long term.
Another valuable lesson for me was to realize that, in today’s globally-connected world, it has become increasingly difficult to separate the clickbaiters and scammers from the valuable content with strong communities. This means that someone who wants to learn about Bitcoin via Twitter should first do the work of “separating the junk from the good sources” in their own research. An investment should never be made based on just one opinion or source.
Manipulation Via Media
Manipulation via media is by no means a new phenomenon and media history shows that it can hardly be eliminated with regulation.
But social media accelerates the impact of contributions and enlarges spheres of influence, accentuating the problem. My goal is to motivate critical engagement with media, even knowing that, globally, this is a difficult endeavor. After all, the ability to critically examine media and one’s own emotional reactions would be a considerable benefit in all areas of life.
This is a guest post by Thierry Berger. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
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