Let them have their FUD
Cryptocurrency FUD is a fact. You know that when people start FUDing, it must be something important, especially if it’s the latest and coolest blockchain project. FUD stands for Fear, Uncertainty and Doubt and is usually spread through media misinformation. FUD can have an immediate effect on cryptocurrencies, as fake news can create volatility in the market to affect the price of a coin or a token.
Traditionally, it is understood as a deliberate attempt to create doubt and fear, or mislead consumers away from a new, alternative product or service. It is used as a marketing tactic by larger companies to cast doubt over competitors’ products, especially when those products are superior.
A typical FUDster is someone who spreads FUD. More generally, FUD can also be any information that is meant to elicit an emotional response, particularly feelings of confusion and suspicion, in order to influence the general opinion on important matters and further particular agendas.
History of FUD
American computer architect and high-tech entrepreneur Gene Amdahl used the term for the first time after he left IBM in the 1970s to start his own company, Amdahl Corporation. He said: “FUD is the fear, uncertainty, and doubt that IBM sales people instill in the minds of potential customers who might be considering [Amdahl] products.”
Amdahl was here referring to the way IBM employees were trying to persuade customers to use IBM products instead of his own ones, which were much cheaper mainframe computers running with IBM software. To convince them, IBM sales employees promised clients that good things will happen to them if they used IBM, and that the future of their competitor’s software was clouded in dark shadows.
In “The rhetoric of dread: Fear, Uncertainty, and Doubt in information technology marketing,” Bryan Pfaffenberger defines FUD as “a marketing technique that a market-dominating firm employs to blunt a competitor’s first-to-market advantage.” A FUD campaign might consist of press releases designed to cast doubt on a product, benchmark tests which are rigged in favour of the company, or the preannouncement of vaporware (inexistent product) that can be timed to sabotage the competitor’s superior product.
Later, in the 1990s, FUD will be generally used to refer to misleading information between competitors. There is also a specific category of business writers who are employed by international corporations to create FUD.
After IBM, Microsoft would become the king of FUD, since its dislike for the free open source software movement would drive Microsoft to the creation of a particular kind of FUD, that of vaporware. Microsoft, for example, would announce the release of a particular product with a free component, knowing that their announcement would deter customers from buying the competitor’s similar feature, even though Microsoft had no product to offer.
FUD in Cryptocurrency News
FUD and fake news are very common among the crypto community. In 2018, for example, FUD and Bitcoin were constantly in the news, as media and well-respected figures expressed their views about the future of Bitcoin. Nobel Prize winner Robert Shiller had told CNBC that Bitcoin “has no value at all unless there is some common consensus that it has value. Other things like gold would at least have some value if people didn’t see it as an investment.” In the MIT Technology Review, an article “Lets destroy Bitcoin,” argued that unless Bitcoin and cryptocurrencies were widely used by the many and not the few early adopters, the coin would never become a reality. As the writer of the piece, Morgen Peck put it: “Bitcoin’s early adopters have held fast to the dream of a single world currency that is private, free for all to use, and under the control of the masses. But the seven billion people not yet using Bitcoin might not care about any of that.”
FUD is just FUD, not a fact, though. In fact, words can be manipulated to express positive things too, which brings us to FOMO. But do not Fear Of Missing Out, we have covered this and other cryptocurrency terms in our Crypto Dictionary.