We Need Less FUD and More Freud

Disclosure: This is an op-ed. The opinions expressed in this article are solely those of the author and do not reflect the views and opinions of The Defiant.

Oren Katz, COO of StarkWare, is both a clinical psychologist and a blockchain pioneer. In this series of columns, he’ll be putting crypto on the couch. He’ll be discussing everything from Freud and FUD to trading FOMO, from the big-picture psychology of crypto’s self-image to the details of our lives — like managing the munchies when the market is down.

Feeling the whiplash? I think everyone in crypto is. Many have experienced a decade’s worth of emotions in the space of five months. What gets us through the uncertainty won’t be yet another tweet of price predictions – it’ll be psychology, and adopting the right mindset. We all need a bit less FUD and a bit more Freud.

Did you watch the price action after Trump’s election, convinced we had hit the Golden Age for digital gold? And remember the buzz about a crypto reserve currency — the moment many believed we’d finally “made it”? Has the price action since then left you confused and sometimes dejected, and the tariffs left you wondering whether our values truly align with this administration? If you answered yes to any of the above, or if you read the news looking for hints over whether your worldview is in favor in the West Wing today, you’re not alone.

Breathe. Like a movie hero derailed by love, our sector has started craving validation in unfamiliar ways. And after adopting impossibly high expectations from the men and women in suits, many of us have been left reeling.

We’ve been knocked sideways — emotionally, psychologically. And that emotional rollercoaster? It deserves more than just hot takes — it calls for deeper reflection.

You’re not going to be surprised that, as a psychologist, I’m going to talk about development. Psychology often focuses on individual development, but much of what it says can be extrapolated to groups, in this case, the crypto community.

It’s predictable that sudden changes in Washington, or any other center of power, will leave us processing a mix of emotions. Like many people navigating complicated relationships with their parents growing up, we’ve never fully defined our relationship with the establishment.

Are we something entirely new? A technological species evolving outside of the traditional power structures? Or are we a counter-culture, still defined in opposition to the system we’re spurning?

If it’s the latter — if crypto is the antithesis of what came before — then this isn’t independence; it’s entanglement.

The great psychoanalyst Donald Winnicott famously claimed that “there is no such thing as a baby.” He meant that a baby simply can’t exist in isolation — only in a relationship with a caregiver. Identity never forms in a vacuum; it forms in context. Crypto’s identity, whether we like it or not, has also taken shape through its interactions — with governments, regulators, bankers, and all the institutions we seemingly wanted nothing to do with.

I think that the sudden semi-embrace from Washington knocked us off balance. We’ve been trying to figure out our identity in opposition to the establishment for years, and suddenly, we felt a sense of total and utter acceptance. We snuggled up like a baby in a parent’s arms and believed, briefly, that the establishment was about to fulfill our every dream.

But in that moment, we forgot that Bitcoin — and therefore blockchain — just turned 16, so in human terms, we’re an adolescent now.

Erik Erikson, the German-American psychologist best known for his theory of psychosocial development, described adolescence as a time of “identity versus role confusion,” where the adolescent’s main challenge is to construct their own unique sense of identity, and find the social environment where they can belong and create meaningful relationships with other people. That’s largely where we are now. We’ve been shaped in some type of relation to the establishment — but now’s the time where we need to figure out who we really want to be. Some of this may, uncomfortably, resemble the establishment — and some will be different. Like the teenager, healthy development means defining ourselves by both what we’re building and by what we’re breaking.

Freud believed adolescence often revives earlier psychological conflicts. Resolving these is essential for healthy adulthood — and not only after this process can a more autonomous relationship with one’s parents become possible.

To build a better sense of who we are, we shouldn’t stop caring what Washington, or any other center of power, thinks and does — we can actually benefit from being more in touch with the world outside our bubble. But we should not base our entire self-perception on what the establishment does, and we should not read it as more than what it is.

We are in an era of strategic ambiguity — in which crypto is alternately praised, ignored, or criticized depending on the day and the agenda. That’s politics. If we expect consistency, we’re setting ourselves up for frustration. We should accept ambiguity and conflicting messages, not be overly influenced by it, but rather understand it, and help use it to better shape ourselves and the world around us.

From the historic perspective, what’s surprising isn’t that we get mixed messages from the establishment — it’s that we get messages at all. We’re only 16, and the world’s powers are already taking us seriously. We may have already reached the “if you can’t beat them, join them” moment. For an adolescent trying to build their own identity, that could be both a blessing and a danger.

The main thing is that we can approach what is coming with confidence, and be secure in who we are becoming, with tempered reliance on external approval. The road ahead will be driven less by the signals we receive, but more by the signals we send, and even more by what we actually do. We’ll talk more about that — on the crypto couch — next time.

Oren Katz is COO of StarkWare, a leading company in blockchain scaling. He has an M.A. in Clinical Psychology and a B.Sc. in Computer Science, Physics, and Psychology. He has worked both in psychology and in tech, and has 25 years of industry experience in software development and product management roles.