When More Is Less: Information Overload and the Psychology of Decision-Making in Cryptocurrency Investment

Abstract

The rapid rise in cryptocurrencies has created an investment environment marked by unprecedented levels of information volume, fragmentation, and volatility. While prior research has examined drivers of trust and adoption in crypto markets, far less is known about the psychological consequences of information overload on investor decision-making. This study addresses this gap through nineteen semi-structured interviews with individual cryptocurrency investors, analyzed using an inductive, manually conducted thematic approach. Findings reveal four interconnected dynamics: decision fatigue and paralysis, heuristic reliance on influencers and peers, emotional strain characterized by anxiety and fear of missing out (FOMO), and diverse coping strategies ranging from selective filtering to withdrawal. These results demonstrate that crypto investing is not only a financial process but also a cognitively and emotionally taxing experience. By linking investor narratives to broader theories of decision fatigue, bounded rationality, and consumer vulnerability, the study contributes to interdisciplinary debates in marketing, behavioral finance, and consumer psychology. Practically, the findings highlight the need for clearer communication strategies, supportive platform design, and financial education initiatives that help investors manage cognitive strain and decision fatigue. In a market where credibility is fluid and decisions are often made under conditions of overload, understanding the psychological dimensions of investment behavior is essential.