This Q&A is the full interview with Dr Lia Nower. For our deep dive into cryptocurrency trading addiction, with contribution from the full panel of experts, please see this article.
Below is an interview with Dr. Lia Nower, Professor and Director of the Center for Gambling Studies & Addiction Counselor Training (ACT) Program. This is the full transcript of our interview, quotes from which were published in our main article on the topic here.
For an in-depth deep dive into the topic of cryptocurrency trading addiction, and its links to gambling, please follow that link. As for Dr Lia Nower’s full interview, please see below.
CoinJournal (CJ): Do you think there are similarities between crypto trading addiction and gambling addiction? If so, could you please name the most notable ones?
They are not different addictions. Trading cryptocurrency can be one form of gambling addiction. Gambling is risking something value (money) on an uncertain outcome with the hope of making a profit. People who frequently trade crypto (versus holding crypto as an investment) are gambling.
CJ: In your opinion, what is it that makes activities such as trading so addictive?
Due to the volatile nature of cryptos, a person can’t predict whether they’ll win or lose big. There’s a huge rush of the pleasure chemical, dopamine, when it surges and you’ve suddenly tripled your money. On other days, you can lose just as big but that also has a rush associated with it, although in a negative way.
In addition to the excitement, there is also the variable ratio reinforcement schedule associated with high-risk trading. When there is a wide variation in payback at unpredictable intervals, this is the most addictive form of conditioning.
CJ: What are your thoughts on influencers who, in return for a fee from the founders, promote obscure cryptocurrencies to their followers with little knowledge of how it works – do you think this is problematic?
You don’t want to know my opinion on influencers in general… They prey on the FOMO in the average person.
CJ: In your opinion, would the daily volatility of crypto prices impact mental health, as people see their investments go up and down so widely each day?
Yes, it fosters an addictive cycle: preoccupation, feelings of withdrawal, tolerance (need to buy more to feel the same level of excitement), chasing (buying more to recoup losses). It can completely consume someone mentally such that they neglect people and responsibilities in their lives.
CJ: Research on crypto trading addiction is still limited, do you think the need for this is likely to grow in future?
Most of us in the field of gambling studies already include crypto trading in our research studies as a gambling activity. I think more people will begin to study it if it continues to be popular and volatile. If it becomes a stable commodity, then it will be used for investment. It is similar to the difference between investing in long-term stocks and trading margins and options, a form of gambling.
CJ: Do you believe the cryptocurrency industry should be doing more to promote safe investing and addressing the problem of addiction?
I think they should be better connected with resources to help problem gamblers but, of course, they don’t want their product to be viewed as gambling. Since it is inherently risky, there is not much they can do about the volatility at this point, which will make it dangerous for excitement seekers and those who want to strike it rich the easy way.
CJ: Conventional gambling is restricted in many territories to consumers 18 and over. Do you believe there should be a similar rule within cryptocurrency, in order to protect younger, more impressionable minds from potential addiction?
Definitely. But I also think that should be the case for risky stocks. As you probably know, there are some basic requirements you need to meet to trade margins and options but some gamified apps have gotten around that by allowing people to revise their answers in order to trade.
Setting an age limit for these things could protect some younger people who tend to be more impulsive. But it wouldn’t do much to help the naive trader who hopes to make money quickly without the expertise.
CJ: If I can push you for a yes or no answer, do you believe the world would be a happier place without gambling?
Gambling is one form of entertainment. For most people, it is not a problem. It is only a problem for a few. So I don’t think it affects happiness for most people.
CJ: Similar to the above question, would the world be a better place without cryptocurrency investing?
Same answer as the previous question.
CJ: What advice can you give people who are interested in trading crypto, who may be predisposed to gambling-related addictions?
If you are investing in crypto when it’s down and plan to hold it long term or a reasonable time then sell it, that seems like a good investment strategy if you can tolerate the risk. If you are riding the market on a daily basis buying and selling, you are gambling and probably shouldn’t be trading cryptos.