2026-01-22 11:34:31

Europe's leading financial regulator just flagged something traders should pay attention to: herd mentality in markets is getting worse, and it's becoming a real amplifier when geopolitical shocks hit the system.

Here's the thing—when uncertainty spikes due to global tensions or political events, everyone starts looking at what others are doing instead of thinking independently. This creates a cascade effect. One investor sells, then another follows, then it becomes a stampede. What could've been a controlled correction turns into a sharp drawdown.

This matters especially in crypto markets. Digital assets are already volatile, and layer in geopolitical pressure (trade wars, sanctions, political instability), and you've got a recipe for exaggerated moves. The herd doesn't think—it reacts. And those reactions compound fast.

The watchdog's warning is basically: Be aware of your own decision-making. When markets get shaky and everyone's panicking, that's exactly when staying rational becomes hardest—and most valuable.

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BTCWaveRider

· 4h ago

To be honest, every time the market fluctuates, everyone follows the trend and sells, without even thinking about why they are selling... That's the most terrifying part.

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Anon4461

· 5h ago

Honestly, this is why every time a black swan event occurs, the crypto market crashes... Everyone follows the trend and dumps their holdings. --- This time, European regulators hit the nail on the head. The idea that "everyone is drunk except me" simply doesn't exist in the crypto market; it's all a herd mentality. --- The most ridiculous thing is that once geopolitical issues arise, rationality immediately breaks down, and it's all panic selling... That's why I find the market increasingly incomprehensible. --- Wait, they say "stay rational"... That sounds simple, but who can really do it? Watching your account plummet and still pretending to be calm? --- Herd mentality, in simple terms, is the herd effect. This approach in the crypto world has been rotten for a long time; no matter how volatile it gets, it's always the same. --- Really, once there's any sign of trouble, collective panic takes over everything. Personal judgment... haha, it's almost useless.

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PuzzledScholar

· 5h ago

Basically, don't follow the trend, but no one can do it.

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Fren_Not_Food

· 5h ago

It's the same herd mentality argument again... It's true, but the key question is, so what if we know? Everyone still gets taken advantage of.

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MeaninglessApe

· 5h ago

It's that old saying again, don't follow the crowd. But when it really comes to a panic moment, who the hell can stay calm?

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NFTBlackHole

· 5h ago

Honestly, the herd mentality has long become tiresome. Every time there's a geopolitical explosion, there's a rush to sell off, and no one wants to hold. That's why I insist on not following the crowd. While everyone is bottom-fishing, I actually took a large position. European regulators' warnings are a bit late... we've been talking about this a few years ago. The crypto world is especially easy to get cut off. With already high volatility, a political event can directly wipe out everything. The key is still mindset. Getting nervous and selling when seeing red candles—how can you make money like that?

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