In today's turbulent era of digital currencies, Bitcoin investment, as a high-profile investment method, is attracting more and more investors. However, with it comes the risk of currency speculation. For investors who want to be successful in Bitcoin investing, it is critical to understand and address these risks. This article will delve into the risks of Bitcoin investment and reveal the secrets to you.

As a virtual currency, Bitcoin has attracted the attention of many investors, but since it is a virtual currency, it will inevitably make many investors feel unsafe, especially in the case of Bitcoin wallets. Today, we will analyze the risks of investing in Bitcoin.

In the process of investing in digital currencies, the biggest risk is not others, but yourself!

Our deposits, invested stocks, securities, etc. There will be a centralized organization to help us defend against attacks, help us handle disputes, and help us retrieve our passwords.

But in the world of digital currency. These safety measures are all put into our own hands.

If you do not control your personal risks well, you may encounter:

1\. Passwords and private keys are stolen, and all digital assets in wallets and exchanges are lost (cannot be retrieved)

2\. Your information will be sold back and forth by the underground industry, and there will be almost no privacy.

3\. If you use the same or similar password in other places (banks, stock exchanges), assets in other places will also be stolen.

**suggestion**

1\. Increase password strength, do not reuse passwords, and do not send passwords online

2\. Don’t run naked on your computer (without installing security and anti-virus software), and don’t go to messy websites (“pornographic, gambling and drug” websites are the hardest hit areas for Trojan viruses)

3\. Wherever you need to enter important information (account number, password, personal information), pay attention to whether the URL is an official website to avoid being phished.

4\. If anyone (family, relatives or friends) asks you to borrow money through the Internet and requires a password and account number... please call to verify whether it is done by him/her.

To sum up: when investing in Bitcoin, the biggest risk is ourselves! We need to learn more and understand some knowledge about network security, so as to effectively avoid the disappearance of the appreciated coins in our hands!

**【Platform Risk】**

Platform risk is actually the risk of the exchange. The coins that everyone puts on the exchange are actually stored in the centralized wallet of the exchange.

If the exchange is attacked by hackers, the exchange will suffer huge losses. At worst, the exchange will bear the losses itself, or at worst, the exchange will go bankrupt.

Historically, exchanges have been attacked not once or twice. Here are a few typical cases:

§ Mt.Gox was hacked, lost 850,000 BTC, and filed for bankruptcy protection

§ Bitfinex was hacked and lost 119,756 BTC

§ Youbit was hacked and 4,000 BTC were stolen

§ There was also the hacker attack on 3.7 just in the past

**suggestion**

1\. Choose an exchange with large trading volume, long history and good reputation.

2\. If you plan to hold it for a long time, do not put a large amount of digital assets on the exchange, and store the coins you do not intend to trade in your own wallet.

3\. Be sure to pay attention to the safety of your wallet

4\. You can use multiple exchanges at the same time to share risks equally

In fact, the security of exchanges is relatively high, because most exchanges will store most of the coins in cold storage and use a small amount of coins for circulation. But because the exchange is so large, hackers will keep an eye on it. 90% of hackers in the world are keeping an eye on exchanges.

You don’t need to worry too much. After all, it is still a small probability event for an exchange to be attacked.

**【Policy Risk】**

Many people think that policy risks have a very large impact, but in fact policy risks have the smallest impact.

Because policy risks are generally not sudden, they will be left to the exchange for a period of time to deal with. After all, a lot of people’s personal property is involved.

**The domestic policy is:**

Maintain a positive attitude towards blockchain. The government and many companies are researching and applying blockchain technology. However, there are certain restrictions on investment in digital assets. At present, the volume of digital assets is not large. If it grows rapidly, it may have a certain impact on the financial industry.

In addition, due to globalization and decentralization, it also involves asset outflows, breaking foreign exchange restrictions to a certain extent.

**Are there any policy risks in my current transaction?**

On-site trading fully complies with domestic laws and regulations, so on-site trading is relatively safe. OTC transactions are not fully compliant from a legal perspective and may be affected by policies, so it is not recommended that you store your coins in OTC exchanges for a long time.

**suggestion**

Pay attention to the latest blockchain and digital asset consultations, and if new policies emerge, just take appropriate measures. Generally there will be no asset losses.

**【Legal Risk】**

High returns are not only accompanied by extremely high investment risks, but also legal risks that cannot be ignored.

After the central bank stopped trading in September 2017, some exchanges moved overseas, and investors also turned to overseas markets for investment and trading, or used online instant messaging software to find counterparties.

"Pay money with one hand and play coins with the other. This is an off-site point-to-point transaction. Currency holders mostly find transaction parties through WeChat groups and QQ groups. In addition to bearing the risk at their own risk, some use group owners to provide third-party guarantees for buyers and sellers. Both parties After transferring the Bitcoin and money to the group owner, the group owner will confirm the transaction and charge a certain guarantee fee," Chen Yunfeng told reporters.

The legal risks of OTC transactions mainly exist in three aspects: credit risk, policy risk and relief lack risk. Therefore, the general public must see the truth about Bitcoin and be particularly cautious in the investment field.