Well I guess bitcoin prices are affected by many reasons such as government issues, its demand and supply and also the media.because bitcoins are on top of the market for the past years the government tends to make a way to control it, many are investing in bitcoins that's why there's also a problem in supply vs demand. and also the media who has the access in everything could give an impression to the investors that can affect to the prices.

True enough for an investors eye if the price is low then thats the right time to buy and just wait for the time it rise its price again, come to think of it, with a small capitalization to buy and add some patience and wait for your investment to grow. It could earn double or even triple soon. Nobody knows the exact timing but taking the risk is much better than not making any moves at all.

If bitcoins were to be legalized the goverment will have the power to monitor and mandate the transactions involving bitcoins. They would establish different laws in order to control and i think it would be not as easy as these days to transact in this business. Strict policies will be implemented.

When you sell your coins at a lower price tendencies are loses on your part so it is better to stay calm and patiently wait for your investment to get back on track, yes it is too risky that you might not get back the old high price but you should also take a look at the other side maybe its just you concentrating on the bad side thats why you never see the good side. Getting panic will not help, you are losing your chances to earn more.

I believe its has both good and bad effects. Good because such institutions would be putting up their investment in bitcoins which means they also knew that there is a big opportunity to earn from it. While on the other hand it would be risky too because there is a possibility of monopolizing the current market due to its high demand in the market.

To manage potential loses during a crash is to have a variety of investments so that you don't need to put all your eggs in one basket. A good financial strategy on how to diversify your earnings could eliminate the chance of total bankruptcy.

Both are used as means of investments and source of funds but each has its own limitations of using. Bitcoins are of free regulations in trading while money should be regulated by banks and financial institutions to which country it is accepted.

Just like other forms of investment it is normal for a bitcoin to face such issues, since it has becoming known in the market,there are alot of factors that can affect the current value of each bitcoin. What is important is that we learn to identify which factors will be beneficial for us. The higher the risk the higher the return.