Acharya Prashant explains that fear is fundamentally rooted in a lack of trust and self-knowledge. Using the example of a person's name, he illustrates that when one is certain of their identity, external labels or insults do not cause distress. However, when an individual lacks internal certainty, they become dependent on the opinions of others to define themselves. This dependence makes them vulnerable to the fear of loss and judgment. He emphasizes that fear is a signal of missing self-trust, where one looks at themselves through the eyes of the world rather than through direct realization.