Not everyone should be trading. That’s not an opinion—it’s just reality.
Money markets, including Bitcoin and traditional assets, are brutal. They don’t care about your feelings, your salary, or what you “thought” would happen. And yet, every cycle, a new wave of people jumps in, armed with zero understanding of risk, loss, or how markets actually work.
A recent question on Reddit perfectly illustrates why some people shouldn’t be anywhere near a crypto exchange.
The Question That Says It All
A user asked:
If I have $10,000 in Bitcoin, with $3,000 of that being profit, and the price drops from $100,000 to $40,000, will I lose more than just my $3,000 profit?
Would my initial investment stay the same, but the amount of Bitcoin I own increase?
At first glance, this might seem like an innocent, basic question. But if you’re trading real money and you don’t already understand this, you should not be in the market.
Let’s break it down anyway.
Step-by-Step Breakdown
Given:
- BTC Price = $100,000
- You own $10,000 worth of BTC
- Your profit is $3,000, meaning your initial investment was $7,000
- Since BTC is $100,000, you now own 0.10 BTC ($10,000 ÷ $100,000 = 0.10 BTC)
What Happens If BTC Drops to $40,000?
- Your 0.10 BTC is still 0.10 BTC
- But now, its value is 0.10 × $40,000 = $4,000
- Your portfolio has dropped from $10,000 → $4,000
- You’ve lost $6,000 from the peak ($10,000 – $4,000)
- Compared to your initial investment of $7,000, you’re now down $3,000 below your starting amount
Two Key Questions Answered:
✅ Do you lose more than your $3,000 profit?
Yes. Since your holdings are worth $4,000, and you originally put in $7,000, you’re down $3,000 from your starting point, not just your profit.
❌ Does your Bitcoin amount increase?
No. The amount of BTC you own stays the same (0.10 BTC). What changes is its USD value, not the quantity of Bitcoin itself.
Why This Matters
This is basic math, but it reveals a deeper issue:
Some People Have No Idea What They’re Doing
If you’re asking whether your BTC amount magically increases when the price drops, you are not ready for this market.
Markets Are Not Designed to Be Easy
People assume they can just “jump in” without any preparation. They think Bitcoin or stocks will always go up eventually. That’s a dangerous assumption. The market does not owe you returns. Especially not in a certain time frame.
Risk is Real
When the price moves against you, your “profit” isn’t protected—it disappears. If you’re not prepared to see your investment lose half its value or more, you probably shouldn’t be in volatile assets at all.
Key Takeaways
- You don’t lose just your profit—you can dip below your initial investment.
- Your BTC amount stays the same, but its USD value fluctuates.
- If you don’t understand basic risk mechanics, you should not be participating.
There’s no shame in sitting out. Some people are better off not engaging in money markets. If you’re unwilling to learn about risk, losses, and market behavior, you’re not “investing”—you’re just gambling. And the market loves to take money from unprepared gamblers.