HODL originated from a typo (of "hold") posted on a Bitcoin forum in 2013, and over time it became the term describing the strategy of holding a crypto investment for the long term, without selling during price drops or trying to time the optimal entry and exit points.
The philosophy behind the term
Given how volatile the crypto market can be, many investors choose to buy and hold for years, on the assumption that short-term noise (sharp rises and falls) matters less than the long-term trend — similar to the logic behind DCA in traditional investing.
When it makes sense and when it doesn't
HODL isn't a magic strategy: holding onto an asset that's losing value for structural reasons (for example, a project with no real use) simply prolongs the loss. The strategy only makes sense if you've already done your own research (DYOR) on the asset you decide to hold long term.