Factors leading to crypto addiction, depression and anxiety

Crypto addiction

People who seek escape, meaning, excitement, or control over their lives in crypto can fall into addiction without realizing it. However, addiction to crypto often has multiple causes that are often interrelated and is not due to a single reason, but rather a combination of biological, psychological, and social factors.

Biological and neurological causes

• Dopamine stimulation: Sharp price movements, profits, notifications = dopamine rushes (reward hormone), similar to gambling or drugs.

• Changes in brain circuits: Long-term trading can disrupt the brain's regulatory centers, leading to a loss of self-control, even though the person is aware of its negative effects. They feel remorse after a loss, but reassure themselves by continuing to trade.

• Genetic predisposition: People who are more prone to impulsivity or addiction are at greater risk.

 Psychological causes

• The desire for quick profits/control over life, escape from stress or emptiness, low self-esteem or the need for recognition, 

• FOMO (fear of missing out) – a powerful driver of risky behavior, getting stuck in a cycle of loss

• The urge to "make up" for losses (chasing losses), typical of pathological gambling

Social, cultural or technical causes

• The influence of influencers and YouTubers who promote "guaranteed tips" and the cult of success and wealth – society often judges people by their money

• Isolation and lack of healthy relationships – the digital world instead of human contact

• 24/7 availability when apps are always at hand + gamification and app design – colors, sounds, graphics reminiscent of a casino

• Anonymity and the feeling that money is "unreal" – clicking is easier than reaching into your wallet

When the crypto market experiences sharp corrections or an investor incurs significant losses, the psychological impact is often devastating, triggering a chain of negative emotional reactions that can lead to serious mental health issues:

The Cycle of Stress and Anxiety: Nervous System Exhaustion

Most crypto traders do not just experience a single crash but a continuous cycle of high stakes:

• Euphoria and Mania: Every successful trade or sharp price increase triggers feelings of euphoria, fueled by dopamine. This compels the individual to risk more and more.

• Relentless Stress: When the market drops, the brain switches to a state of acute stress and anxiety. The constant alternation between adrenaline highs and panic lows severely exhausts the nervous system. The body remains perpetually stuck in a "fight or flight" response.

• Resulting Anxiety Disorder: This chronic exhaustion impairs the natural ability to regulate emotions and stress. Instead of temporary fear, a generalized anxiety disorder can develop.

The Onset of Depression: Helplessness, shame, and guilt

• Helplessness and Despair: The loss of substantial financial assets leads to the crushing realization of the capital being gone. The feeling that one can do nothing to reverse the situation generates deep helplessness, a core symptom of clinical depression. 

• Shame and Guilt: This realization is often compounded by shame and guilt. Shame arises from feeling like a personal failure and inadequacy, while guilt is linked to the harm the loss inflicts on family and loved ones. These emotions are highly destructive and perpetuate depressive states.

• Social Isolation: The shame of the losses often forces the investor into social isolation and secrecy about the problem. This isolation further deepens the depressive mood and makes it difficult to seek essential help.