Crypto gambling has become one of the biggest issues within the industry. This is evident from the various issues that have arisen as a result of the losses obtained in the current market cycle.
Addiction it seems has ruled the various forms of extreme sentiments seen. It is evident from the cycle that if the crypto gambling problem isn’t addressed, real-life problems and consequences will further ensue from the chaos.
We reached out to Max Coupland, director at CoinJournal for more insights into this problem.
He explained unique aspects and perspectives most people haven’t yet considered.
If you think you have a crypto addiction problem, help is always available!
Here is what he had to say.
Max Coupland, Director at CoinJournal
What is crypto addiction?
A cryptocurrency addiction involves becoming obsessed with buying and/or selling cryptocurrencies. It may also involve feeling the need to keep up to date with the changes in price of cryptocurrencies by constantly checking crypto news and charts.
What’s the difference between crypto addiction and gambling?
In some ways, crypto addiction and gambling are very similar. For example, both can have a severe effect on an individual’s mental and physical health, and involve people risking their personal finances.
However, the difference between the two is that people don’t necessarily realise what they’re getting themselves into when they start to invest in crypto.
There is currently no specific body that regulates crypto addiction, whereas, for gambling, there is BeGambleAware, which helps people to make informed decisions about their gambling habits. Although Britain’s Financial Conduct Authority has said that they plan to introduce stricter laws about crypto ads, these are yet to be put in place.
What are the short-term, medium-term, and long-term effects of crypto addiction?
Crypto addiction can have a detrimental effect on both a person’s mental and physical health. When someone successfully increases their crypto portfolio, it can cause them to feel an extreme euphoric high, however, they may feel an extreme low when they make a loss.
Even when an individual isn’t making a loss, they can feel strong senses of regret over the fact that they have invested so much of their money into crypto. This can lead to things such as insomnia and night sweats.
If people become obsessed with buying and selling crypto, they may also start to cancel social plans and have a severe lack of sleep, due to feeling the need to constantly keep up to date on the cryptocurrency industry.
What is the difference between crypto addiction and crypto investing?
Crypto investing presents itself in many ways, such as buying cryptocurrency directly, investing in crypto companies or crypto-focused funds and becoming a crypto miner or validator.
Someone who safely invests in crypto may thoroughly research a particular coin before choosing to invest in it and pay attention to things such as transaction fees.
Due to this, they are more likely to be better at analysing the risk of investing in crypto. Crypto addiction involves becoming obsessed with the act of investing in crypto, which can lead to various other habits such as stealing from loved ones to fund their addiction, bad sleeping habits (e.g insomnia, lack of sleep and night sweats), alcohol and drug addictions, depression and anxiety, and withdrawing from social interactions. People with a crypto addiction are also more likely to be more hasty with their investments, rather than calculating the risk.
Are there any statistics regarding crypto addiction?
As it’s still a relatively new market, there hasn’t been much analysis of the crypto industry when it comes to addiction.
But, based on generalised gambling disorder statistics, it is thought that approximately 1% of traders within the crypto community will develop a severe addiction to it, which can even lead to being admitted to rehab clinics for their disorder.
In addition to this, up to 10% of crypto traders will experience difficulty related to cryptocurrency investing, which is beyond minor financial losses.
What drives people to become addicted to cryptocurrencies?
There are a wide range of reasons why people become addicted to cryptocurrencies, with one of the major ones being availability. The crypto trading system is available at all times, the coins never shut down and the exchanges never close. Because of this, people that are addicted to crypto trading are able to access the industry at all times.
It’s also relatively easy to trade cryptocurrency, as it can be accessed through digital and mobile devices. Online exchanges also only take minutes to set up and connect to a bank account, so it can be a very quick process.
What steps can governments take to prevent and treat crypto addiction?
In terms of preventing crypto addiction, governments would need to enforce stricter rules when it comes to crypto advertising. For example, there are a lot of crypto adverts within the sport community, particularly within the stadiums. Arsenal football club were reprimanded by the ads watchdog in August, after an advert for ‘fan tokens’ on their Facebook page and website.
They claimed that it wasn’t made clear that the tokens were crypto assets and that they didn’t correctly illustrate the risk of the investment. Holding big companies responsible for not being transparent enough about crypto topics would be a really great start to preventing crypto addiction.
In terms of treating crypto addiction, governments could introduce treatment for the disorder at more rehab clinics, such as Castle Craig, so that people addicted to crypto trading can receive the right level of formal help and support.
What role do you think proper regulation will play in ensuring that crypto addiction is mitigated?
Proper regulations, such as limiting the number of crypto adverts and where the adverts are allowed to appear, could very much create an ‘out of sight, out of mind’ mentality. When people see these adverts, they can become curious and want to dabble in the crypto trading industry, in order to see what it’s all about.
For example, crypto adverts in sports stadiums are seen by a vast number of people, both those in the stadium and those watching at home.
By limiting the number of these adverts, you are working to decrease the number of people which are either being introduced to or reminded of crypto trading. Every little helps when it comes to mitigating addiction.
What role does research play in making effective cryptocurrency investment decisions?
Research plays a really vital role when it comes to investing in crypto. It means that an individual’s chances of having a successful investment and adding to their crypto portfolio are increased.
There are a few things that you can do when it comes to thoroughly researching a cryptocurrency investment. For example, crypto projects release something called a whitepaper when they first launch.
These documents provide details that outline the project’s purpose, vision and philosophy, including statistics, graphs and algorithms.
You can also check to see if your chosen crypto project has a lot of activity, such as active social media pages, a community on sites like Reddit and high trading volume levels.
Just how pliable are cryptocurrency investors when it comes to project shilling?
Project shilling refers to the advertisement of a crypto project before its developers raise funds from investors and then ditch the project they used to create a buzz.
When it comes to project shilling, you might come across phrases such as “the best cryptocurrency to ever emerge” and “you need to invest now before the price increases”. This is an attempt to generate a sense of excitement around the project and get people to invest in it.
The more people that invest, the more tokens that are demanded, the more the price increases. In the past, crypto investors have lost a lot of money due to project shilling, particularly the projects that involve social media posts made by high-profile celebrities such as Kim Kardashian and Floyd Mayweather.
However, people are now more aware of project shilling and are more careful when investing in a new project.
As the cryptocurrency space matures, do you think crypto addiction will continue or is it a passing phase?
It’s hard to say whether crypto addiction will eventually be eradicated or not, for a few reasons. There hasn’t been enough research into crypto addiction for us to know exactly how many people currently suffer from it.
If more research is carried out, then we will be able to introduce more formal support for people, such as rehab clinics and support groups. Also, stricter laws on the advertising of crypto would hopefully help to eradicate the problem.
How best can crypto addiction be managed?
Every individual with a crypto addiction will require different needs in order to manage it, but there are some basic steps which you can take in order to help yourself.
To start with, you can set yourself limits in regards to how much time and money you spend on crypto within a certain time period e.g per day or per session. If you have a crypto trading account, then you can ask them to set a limit on it, so that you can’t exceed your chosen amount.
Try your best to keep yourself busy with other activities too. Whether this is finding a new hobby, spending time with loved ones or joining a social group, make sure you are keeping your mind busy on things other than crypto.
It’s also really important to consistently remind yourself that crypto trading shouldn’t be your primary income and that you are taking part in an unpredictable environment.
What role can internal support networks (friends and family) play to help overcome crypto addiction?
There are many ways in which individuals can help and support a loved one with a crypto addiction. One of the most important things is to simply just listen. Even if you don’t agree with them, try to show a level of concern and understanding as to how they are feeling.
It’s also important to set boundaries, such as not providing constant financial aid, making excuses for their behaviour or lying for them in order to cover up their addiction.
This is beneficial to everyone concerned, as it shows concern towards the individual’s well being and will hopefully prompt them to seek help.
It can also be good to attempt to reduce the amount of triggers present in the individual’s life, such as removing financial related newspapers and trading books from their regular environment, blocking crypto and financial related news on various forms of technology, such as mobile phones and computers, and limiting screen time.