I Tried Day Trading Bitcoin for a Week - Beginner Crypto
If you buy Bitcoins at one price and then sell them for a higher price, you make a profit of the difference between those two prices, less any commission that you paid. However, if the price goes down, you will be in the uncomfortable position of having to either sell them for a loss or hold and hope the price goes back up while risking higher and higher losses if the price continues to drop.
Before the current rise to over $200, Bitcoins once dropped from $35 each to $2 each.
What I'm saying is that you should definitely not invest any money you cannot afford to lose, understand that you may have to take a big loss if you're forced to sell out when the market is weak, and also realize that the entire Bitcoin economy could collapse at any time.
The other issue you have to consider is how you're going to store your Bitcoins.
You can store them yourself using the Satoshi Bitcoin client. But then if your computer is hacked or your hard drive crashes and your wallet isn't properly backed up, you can lose everything. If you use an online wallet service, like the one built into most exchanges, there is always the risk that the service will go out of business or steal your funds and claim you withdrew them.
There is huge upside potential, but the risks should not be understated.
answered Apr 11 '13 at 3:41
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