In crypto, the term “Paper Hands” is used to describe an investor who sells his investment for fear of potential loss at the first sign of financial turmoil. Investors with “Paper Hands” are often associated with low risk tolerance as they will miss out on potential gains should the market recover.
The term has a negative connotation and is often used to mock early sellers. If someone is described as “Paper Hands”, they are easily seen as panicked and lacking determination.
The term “Paper Hands” in crypto contrasts with “Diamond Hands”, which is used to refer to an investor who holds their investment despite large price fluctuations.
The term gained popularity during the notorious GameStop short squeeze on Reddit in 2021, when investors caused a spike in the stock price. Termwas used to describe investors who cash out for a small profit or sell their shares when the price drops and lose potential gains when the stock price soars.
