Thanks! I'll combine with the other suggestion "liquidity" for naming.
They're not warning you about the dangers of daytrading. They're warning of the possibility that your exchange could steal or lose all your coins like Mt. Gox.
Exactly. You could earn some btc through day trading, but you may never be able to withdraw your bitcoin lol.
OP, maybe you should read those replies more carefully.
If you really want to use 100btc on day-trading, you should really create an offline wallet or a paper wallet to store the other 400btc.
I said in the first post "'the other 400 are retained for other purposes." Buziss' reply assumed
the other purpose being long term holding. For the real long term investment I have a seperate wallet already. The "'the other 400 are retained for other purposes" expands to "the other 400 are retained on the trading account for other trading techniques that are not classifiied as day-trading, more specific, for the purpose of lending to other day-traders for their margin trades." So Buziss misread me in the first place. Nonetheless I learned the lesson: I'll not give chance to this kind of miscommunication again.
But consider we are in the newbie forum, I'll not marginalize the exchange risk one is exposed to. Read my other post: "
a continued inspection of China"
Second: larceny in China is to cause more damage to trust than the same level of security breach would normally cause, because exchanges are playing banks' role. Although everybody are apparently worried about fund security, no one in the event knows electrum and amory. Some use bitcoin client as-is; most keep the money on the exchange and use them as a bank. Most major exchanges offer wallets, but they are only as trust-worthy as the exchanges. Some in the meeting even argue that keeping the coins on exchange accounts may be safer than in bitcoin-qt, because few have the resource to secure their own PC (they feel helpless against viruses).