Bitcoin is back in the spotlight, capturing the attention of investors and market watchers once again. After a prolonged period of relative obscurity, the pioneering cryptocurrency has surged dramatically—its price climbing from over $3,000 in late May to nearly $4,000 by the end of the month, marking its highest level since July 2014.
On Huobi, one of China’s leading digital currency exchanges, Bitcoin briefly reached ¥3,988 (approximately $3988 at the time), just shy of the symbolic ¥4,000 threshold. While prices have since pulled back slightly, they continue to hover between ¥3,700 and ¥3,800, indicating sustained momentum. Notably, this rally occurred without a significant spike in trading volume, suggesting that market sentiment may be shifting even among cautious participants.
With Bitcoin re-emerging as a hot investment topic, many are asking: Is now a good time to buy? What risks should investors watch out for? Let’s explore the drivers behind this surge, assess the real risks, and offer practical guidance for those considering entering the market.
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What’s Driving Bitcoin’s Recent Surge?
Bitcoin’s latest rally has thrust it back into the financial headlines. But for many new or casual investors, questions remain: What exactly is Bitcoin? And why is it suddenly worth nearly $4,000?
Bitcoin (BTC) is the original decentralized digital currency, first introduced in 2009 by an anonymous developer known as Satoshi Nakamoto. Unlike traditional fiat money issued by central banks, Bitcoin operates on a distributed ledger technology called blockchain, with no single authority controlling its issuance or transactions.
There are two primary ways individuals acquire Bitcoin:
- Mining: Using powerful computers to solve complex mathematical problems that validate transactions on the network. In return, miners receive newly minted Bitcoin as a reward.
- Trading: Buying Bitcoin directly through cryptocurrency exchanges using fiat currencies like USD or CNY.
One key factor fueling current optimism is the upcoming Bitcoin halving, scheduled for July 2025. Every four years, the block reward given to miners is cut in half—a built-in mechanism designed to control supply and maintain scarcity. Historically, these events have preceded major price increases.
According to Du Jun, co-founder of Huobi, the halving plays a crucial role amid a broader “scarcity of investment opportunities.” As traditional markets struggle, investors are turning to alternative assets like Bitcoin, anticipating increased demand and constrained supply.
However, Da Hongfei, CEO of Onchain and a prominent figure in China’s blockchain scene, cautions against oversimplifying the price surge. He argues that most Bitcoin traded today isn’t newly mined but held by long-term investors. Therefore, the immediate impact of reduced mining rewards on overall supply is limited.
“Short-term price movements are influenced by many factors,” Da explains. “Market sentiment, speculative trading, and even potential manipulation can all drive volatility. It’s rarely just about supply and demand.”
The Hidden Risks: Navigating Black Swan Events
Despite growing adoption, Bitcoin remains highly speculative—and vulnerable to sudden shocks.
China alone accounts for roughly 2 million of the estimated 5 million global Bitcoin users. A typical investor profile? Male, aged 30–39, often working in IT or finance, with at least a high school education. These are informed participants—but even they face uncertainty.
Take Zhu Jiang (a pseudonym), an IT professional who shifted from stocks to Bitcoin after market losses earlier in the year. He praises Bitcoin’s 24/7 trading availability and lack of transaction fees on domestic platforms. “It’s much more flexible than stock markets with their T+1 rules and circuit breakers,” he says.
Yet Zhu admits concern: “Prices swing wildly based on news cycles. One day it’s up 20%, the next there’s talk of another ban—and everyone panics.”
His fears aren’t unfounded. In 2013, Bitcoin surged past ¥8,000 before plunging nearly 50% after China’s central bank and four other ministries issued a warning about Bitcoin risks.
Volatility isn’t just local. Global regulatory shifts can trigger massive swings. For instance:
- In late 2025, the U.S. Commodity Futures Trading Commission (CFTC) classified Bitcoin as a commodity.
- Over 20 U.S. states have granted licenses to crypto exchanges.
- Japan has moved toward formal regulation.
- Luxembourg became the first EU country to issue a Bitcoin exchange license.
Even in China, where direct trading remains restricted, PBOC Governor Zhou Xiaochuan publicly acknowledged the potential of blockchain—the technology underpinning Bitcoin—boosting institutional interest.
Still, legal ambiguity persists. As宋一欣 (Song Yixin), a partner at Tianming Law Firm, notes: “Bitcoin investment isn’t illegal fundraising or a zero-sum game—it’s a legitimate form of investment. But that doesn’t eliminate risk.”
Two major concerns stand out:
- Technological disruption: Advances in mining efficiency could reduce profitability.
- Regulatory backlash: If Bitcoin threatens central bank sovereignty or monetary control, governments may intervene.
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How to Invest Safely: Avoiding Common Pitfalls
With Bitcoin near multi-year highs, should you invest now?
Experts are divided. The halving may support higher prices—but timing the market is risky. As one seasoned trader advised: “Always set stop-loss and take-profit levels. Don’t get emotional. The ability to automate trades gives you an edge—use it.”
Here are three critical risks—and how to manage them:
1. Exchange Risk (Counterparty Risk)
The biggest threat isn’t price volatility—it’s whether your exchange is trustworthy.
Du Jun emphasizes: “Most Chinese platforms lack state backing or formal regulation. Size and history don’t guarantee safety.”
A better indicator? Venture capital backing. Platforms that have raised funds from reputable VCs tend to have stronger governance and financial health—because investors conduct deep due diligence.
2. Storage Security
Where you store your Bitcoin matters immensely:
- Small holdings (<10 BTC): Use trusted mobile or desktop wallets.
- Medium holdings (10–100 BTC): Consider secure online wallets or hardware devices.
- Large holdings (1,000+ BTC): Use cold storage. Generate private keys on an offline computer, print them securely, and store copies in bank vaults or safety deposit boxes. Encrypt and keep multiple geographically separated backups.
Never leave large amounts on exchanges—hacks and exit scams happen.
3. Scams and Fake Experts
Beware of so-called “gurus” offering free price predictions to gain trust—then charging for premium signals.
As one investor warns: “They’re like stock tipsters from the past—just digital versions. If someone promises guaranteed returns? Run.”
Frequently Asked Questions (FAQ)
Q: Is Bitcoin legal in China?
A: While financial institutions are barred from handling Bitcoin transactions, personal ownership and investment are not explicitly illegal. However, trading on domestic platforms has been restricted since 2017.
Q: Will Bitcoin keep rising after the halving?
A: Historically, halvings correlate with bull runs—but not immediately. Market sentiment, macroeconomic conditions, and adoption trends also play key roles.
Q: Can Bitcoin replace traditional money?
A: Most experts don’t see it becoming legal tender soon. Instead, it's increasingly viewed as a digital store of value—like “digital gold.”
Q: How do I buy Bitcoin safely?
A: Use licensed international exchanges with strong security practices. Enable two-factor authentication and withdraw funds to private wallets after purchase.
Q: What if I lose my private key?
A: There’s no recovery option. Your funds will be permanently inaccessible. Always back up keys securely and test recovery procedures.
Q: Is now too late to invest in Bitcoin?
A: It depends on your risk tolerance and time horizon. Many institutional investors view it as a long-term hedge against inflation—not a short-term gamble.
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Final Thoughts
Bitcoin’s resurgence near $4,000 reflects growing confidence in its scarcity model and long-term value proposition. While regulatory clarity is improving globally, risks remain—especially around exchange reliability and personal security.
For those considering entry, education is key. Understand the technology, respect the volatility, and prioritize security over convenience.
Whether you're drawn by the halving narrative or broader macro trends, remember: successful crypto investing isn’t about chasing pumps—it’s about disciplined strategy, risk management, and staying informed.
Core Keywords: Bitcoin price surge, cryptocurrency investment risks, Bitcoin halving 2025, blockchain technology, digital currency exchange security