The Risks of Bitcoin that investors need to be aware of
Risk one-The volatility of bitcoin bitcoin blackjack
Everyone knows how volatile bitcoin is and those who invest in this will see the value of this cryptocurrency fluctuate quite dramatically. Unless you can cope with the rises and falls of bitcoin then investing in bitcoin is not for you. There is little to be gained if the loss of your capital is going to cause you to lose sleep. I cannot stress enough the importance of using your discretionary spending money to play the cryptocurrency market.
What is discretionary spending?
It is money which is spent on travel, eating out, entertainment, hobbies and sports.
You would never spend the rent money or money which has been set aside for your retirement on entertainment such as a day out at the races so you should not use that money for playing the cryptocurrency market either.
Risk two-Hacking
A company called “Cryptopia ” which was an online bitcoin trading platform held funds invested in Bitcoin. It was hacked into and all those with bitcoin invested with cryptopia lost their money. There were some sad stories concerning the large amount of money lost by some individuals.
It has to be repeated that you should never play cryptocurrency money with funds you cannot afford to lose or to place too many eggs in the one basket as many of these investors appear to have done.
The other thing I have to add is that the actual amount of money lost by cryptopia investors is likely to be grossly inflated due to the rising price of bitcoin. If someone invested $1,000 in bitcoin and this rose to $10,000 in a few years only for them to lose the lot. It will go on record that this person has lost 10k when in actual fact, it was just 1k they lost.
Risk three-Lost passwords