Not long after covid-19 forced Patty Fiore to move her therapy practice to Zoom, she started noticing a new affliction. Her new clients, many of whom were from San Francisco, described to her how the crypto industry was wrecking their mental health. Crypto’s wild ride, Fiore said, was affecting their psyche. “‘Should I have sold it at a higher price?’ ‘Should I have done it two months ago?’ All these questions were cropping up, along with regret, depression, and anxiety.”
Over the past five years, as cryptocurrencies have scaled new heights—and fallen from them—psychologists and therapists have stumbled upon a burgeoning new field of study. Many crypto traders exhibit behaviors that recall other forms of addiction—to alcohol, say, or gambling—but that also bear the unique stresses of this particular market. Fiore has been particularly well-placed to recognize this phenomenon, because she’s a crypto trader herself.
Through the pandemic, even as the prices of bitcoin and other cryptocurrencies rose, Fiore kept receiving new clients linked in some way with the industry: traders as well as employees of crypto companies. Since December, though, as the values of many cryptocurrencies have dropped—with bitcoin, the most prominent, tumbling from nearly $68,000 to a late January low of around $35,000—the number of inquiries for Fiore’s services jumped. Most of the dozen-odd clients she sees regularly for crypto-related issues have found her in the last two months. “Some of these are new clients, and some are people who weren’t into crypto when they first came to me but who invested last year,” she said.
Other therapists report a similar surge in the number of fretful crypto enthusiasts seeking them out. Since the crash, Peter Klein, a London-based therapist, has gotten 30-40 inquiries, he said; in sum, over the last four years, he must have seen at least 70 clients who want to talk about crypto. Klein also sees his clients on Zoom; others, perhaps more well-heeled, can check into a Scottish manor house called Castle Craig, which offers a line of treatment for crypto trading addiction.
Like her colleagues, Fiore views crypto investing as analogous to gambling in how it encourages addiction. Crypto holds the promise of huge rewards but also shares the volatility of a game of chance, she said. “Addiction is all about those highs and lows,” Fiore said. And now, in this extended low, “they’re experiencing sleeplessness and anxiety, they’re worrying about future. All of this creeps up when bitcoin is dropping.”
Fiore’s first-ever crypto client came in 2020 not as an investor but as an employee of a company working on a coin offering. But the particular characteristics of the crypto market applied nonetheless, Fiore found. “She was involved in raising money in what still felt like a new industry,” Fiore said. “Some people thought of crypto as a Ponzi scheme. And investors in the company were going against the grain of that thinking. So she was taking a chance and defending the industry, knowing that if it crashed, she’d have to deal with everyone turning around and saying: ‘I told you so.'” The frustrations of beating back people’s mistrust even as prices fluctuated began to affect her client’s psyche, Fiore said. “I’ve been buying and selling crypto for the last five years, so I understand what she was saying. I could help her process her thoughts.”
Her investor clients found their mental health affected similarly by the market’s uncertainties. “Unlike the stock market, crypto never sleeps,” Fiore said. “You can trade it 24 hours a day. It’s a drug that is consistently available.” By obsessing over crypto, and by making or losing money on it, people were upturning their lives. Their spending patterns, their sleep cycles, their relationships, their social priorities, and their financial stability all changed.
It isn’t just loss-making investors who worry about their fixation. Six months ago, on the Reddit channel r/CryptoCurrency, a thread about crypto addiction started and grew to nearly 1,000 comments, with people describing how they veered into a kind of addiction. “i’m betting on sports almost my whole life, and the high of crypto pumps and getting 3x,4x,10x money from yor investment is much stronger than high from sports betting,” one user wrote. Another user admitted: “Checking cryptos is my daily dose of dopamine… It’s definitely a cheaper and less damaging addiction than golf or alcohol or both but still would qualify as an addiction.”
Not every crypto investor devolves into an unhealthy state of mind, of course. Klein, who trades crypto himself, and who says he can “definitely empathize with the pain of losing money,” pointed out that there are plenty of people who don’t get addicted. Most of his crypto clients are male: “That fits with the literature, which says that men are more likely to get addicted than women.” Most are in their 20s, but there are also some in their 40s with a longer history of addiction to other substances. Invariably, Klein’s clients have underlying difficulties: anxiety, depression, a tendency to withdraw, personalities prone to addiction, domestic problems. These traits manifest through crypto, as they would through other kinds of habits.
Klein narrated the story of one client, tweaking some details to protect confidentiality. As an investor, he’d made plenty of money through crypto, but trapped in a tense marriage, “he withdrew more and more, to the point that he was always down in the basement, snorting coke and trading crypt,” Klein said. “Crypto became a form of escape.”
Sorting through these issues involved not tackling crypto directly but “stabilizing the lives” of the people in the relationship. This is a standard approach to any kind of addiction, Klein said. “You look for cues in these people’s environment that trigger the need to trade.” But these clients also reminded Klein of others he has had from London’s financial sector: the same kind of compulsive behavior, the same anxieties, the same tendency to suffer in silence. “That’s the trouble with crypto addiction,” he said. “It isn’t observable. No one gets a hangover or gets aggressive. But then they lose their money or mortgage their house, and it blows up.”