Now that you are more aware of the benefits of holding and using the various different forms of Bitcoin storage, we offer one word of caution. Bitcoin, much like any other form of wealth is not completely immune to market fluctuations, theft by extortion, misuse, or government manipulation and control. It is impossible to predict which of these factors will be most prominent in the future for your individual circumstances.
Market fluctuations refer to the continually changing price of bitcoin globally or for your market. Bitcoin has proven to be very volatile ever since it was first invented and there is every possibility it may dramatically lose its value in the future (although we believe it will always recover if this happens). You can safeguard your coins against every other form of theft or loss conceivable but you probably can’t do much to safeguard against loss of its core value.
Theft by extortion is more serious and refers to kidnapping or threats of violence (or actual violence) which a criminal can do to you to try to steal your Bitcoins. Of course this risk is existent for any form of wealth but it can be especially prominent with Bitcoin as bitcoins can be much more accessible than say property or gold jewelry or cash stored at a bank and a thief can much more easily get away with stealing it. The best safeguard against this is secrecy and anonymity. If no one knows you own a lot of bitcoins, no one will target you. The other safeguard if you have a large number of bitcoins is to make it impossible for you to access the large stash of bitcoins without first either (1) visiting a bank safe or (2) digging up a buried usb in a location not in your main place of residence.
Misuse is the use of bitcoins in ways that may be deemed illegal or unsafe. Examples of illegal use may be money laundering, using it to purchase illegal online items, or using it to send large amounts of wealth out of your country (if this is indeed illegal in your country). Examples of unsafe use is online gambling, using very new untested bitcoin services, or making it too easy for others to track your spending through the blockchain.
Government manipulation and control refers to the political climate of the place you live in and what the laws there are relating to bitcoin ownership and use. It is entirely possible that your government may try to ban or confiscate bitcoin in your country, much like many governments have tried to ban or confiscate gold throughout history. Always be mindful of your local laws and regulations regarding bitcoin and act accordingly.
As you can see, your personal investment in bitcoin should be proportional to your level of knowledge of it and your level of personal wealth. It is necessary to consider your personal circumstances when deciding on how to buy, store and use bitcoin. Good luck in all your future endeavors relating to bitcoin.