Bitcoin risk: Extreme price swings and total loss lurking for all investors

The story of Bitcoin risk is one of constant drama. Since early April 2024, Bitcoin's price has once again proved that this asset is anything but safe. After reaching a peak of nearly $72,000 per BTC in mid-March, the price plummeted to under $57,000 within a matter of weeks – a brutal 20% drop that left many investors shaken. Today, Bitcoin treads uneasily around $61,000, but those numbers can change in a heartbeat. To put it plainly: the rollercoaster of recent months exposes how unpredictable and dangerous Bitcoin remains. For conservative savers, this is not just volatility – it's chaos. Is this still investing, or already pure gambling?

If you’re still willing to take the risk: Open a trading account here

Current news only adds fuel to the fire. Just two weeks ago, the U.S. Securities and Exchange Commission (SEC) sent shockwaves through the market by signaling renewed scrutiny of crypto exchanges and potential crackdowns on so-called "unregistered securities." (Source: Bloomberg, CoinDesk). Meanwhile, regulatory debates in the European Union have heated up, with new proposals aiming to tighten anti-money laundering controls that directly impact Bitcoin trading (BTC-ECHO, June 2024). This uncertainty has led to a series of flash crashes, with prices collapsing within minutes after unfavorable headlines: A 12% intraday drop on April 30th serves as a terrifying example. Looking at the news flow, the risk of draconian measures or outright bans on crypto exchanges seems less and less far-fetched. If sentiment shifts, there is often no time to react – those who wait "just one more minute" risk being left with massive losses.

But the dangers of Bitcoin risk go deeper. Unlike shares in established companies or physical gold, Bitcoin has no intrinsic value – it is neither asset-backed nor yields dividends or interest. Its worth is purely driven by speculation and the hope that someone else will pay an even higher price later. If the faith of the crowd crumbles, nothing remains except digital numbers – unprotected by any government, not covered by deposit insurance, and completely exposed to emotion-driven market panics. The scenario of a total loss is not science fiction: Exchange hacks have repeatedly wiped out entire holdings, and a lost private key means your Bitcoins are gone forever, with no way to recover them. Even seasoned crypto fans regularly fall for "Phishing" scams, while coordinated "pump and dump" schemes have manipulated prices mercilessly. Every transaction is irreversible and, because of the unregulated environment, there is no legal safety net for victims.

There’s also a dangerous psychological component: Many investors are seized by FOMO (fear of missing out) at each new all-time high, only to panic-sell when prices collapse in the following days. This cycle of greed and fear creates fertile ground for herd-driven bubbles and brutal crashes. In the end, only professional traders and speculators – those who treat Bitcoin as a high-stakes game – have any chance of staying afloat. Anyone treating it as a safe haven or even as a "digital gold" risks being wiped out by a single market shock.

The bottom line? Bitcoin risk is immense. In the past three months alone, short-term swings of over 10% in a single day have been the rule – not the exception. While proponents tout technical innovation and a decentralized vision for the future, none of it changes the fact that your capital is permanently at risk. For risk-averse investors and those who depend on their savings, Bitcoin is simply unsuitable. It is speculation in its purest form and should only be approached with absolute caution – if at all. Ask yourself: Can you afford to lose everything?

I understand the risks but still want to trade: Open an account anyway