Bitcoin risk: When volatility turns savings into speculation – why your capital is at stake

Bitcoin may promise revolutionary technology – but over the past three months, its chart has looked less like an investment and more like a rollercoaster designed to test nerves. Since early March 2024, the Bitcoin price has swung between roughly $61,000 and over $73,000, seeing abrupt drops of up to 14 percent within single trading days (source). Only in late April did Bitcoin crash from about $66,000 to under $57,000 in just a few hours, wiping out billions from crypto portfolios worldwide in what traders call a "flash crash." Such brutal swings defy all notions of security or long-term investing. Is this still an asset, or pure gambling under the banner of digital freedom? The Bitcoin risk is that even a minor news item can trigger devastating losses.

If you still want to take the risk: Trade Bitcoin here (at your own risk)

Recently, the warning signals for Bitcoin investors have been blaring loudly. States have threatened stricter regulation: In June 2024, the US SEC once again postponed key approvals for crypto-based ETFs (source). At the same time, authorities in Asia and Europe are tightening controls, and the debate on crypto taxation is growing ever fiercer. Only a few days ago, a major crypto exchange reported a security breach that jeopardized millions in customer assets – proof that hack and scam incidents remain an everyday risk in the Bitcoin universe (source). Even prominent analysts are sounding alarms. Renowned voices from Bloomberg warn that the current hype could be nothing but a classic bubble, warning of "irrational exuberance." At the macro level, things look gloomy as well: recent interest rate hikes by the Fed and ECB, as well as the continued strength of the US dollar, are making speculative assets like Bitcoin less attractive. What is celebrated today can collapse tomorrow.

But what's behind this digital mirage? According to bitcoin.org, Bitcoin is an open, decentralized payment network. It relies on peer-to-peer technology and blocks are mined by the community. But the crucial difference to stocks or gold: Bitcoin has no intrinsic value. There are no sales, assets, or dividends – just pure speculation on the price. If you lose the private key to your Bitcoin wallet, your entire capital is lost forever. Hackers repeatedly loot exchanges, and even tech-savvy investors are not safe. The psychological pressure is enormous: hype can trigger FOMO (fear of missing out), but just as quickly, panic selling can trigger free falls. This high-risk environment is further fueled by the absence of secure regulation and state safety nets: If the system fails, you have no recourse.

Let's put it in numbers: While blue chips like Apple or stable assets such as gold move at a cautious pace, Bitcoin can drop or rise by $5,000–$10,000 in mere hours, without warning. Stop-loss protections often fail due to market gaps and exchange outages during high volatility. In the worst-case scenario, a "black swan" event can lead to a total loss, as seen in past exchange collapses. The risk profile is extreme: Bitcoin is not a safe haven or an alternative to the euro, but a high-stakes, high-volatility bet on a digital future that may never materialize. Savers who want to secure their money for the long term should stay far away from such assets. The line between speculation and sheer gambling is blurred – with your capital on the line.

Conclusion: If you're thinking about Bitcoin, you should know that you're playing with fire. Bitcoin risk is real, and the dangers are many: regulatory uncertainty, technical failures, market manipulation, and psychological traps. For ordinary investors and cautious savers, the potential for total loss far outweighs any promise of quick riches. Only those who can afford to lose everything – "play money" in its truest sense – should even consider Bitcoin trading. For all others, the rule is: Capital preservation beats the thrill of the casino.

I accept the risk – open account despite warning