>* Traders will devise a suitable risk management plan prior to initiating a short position. Unlike the media driven nonsense about a large activist shorting a bull market permanently, many traders can and do make leveraged long and short trades all the time, with the intention of exiting at a loss if the trade doesn’t go immediately (for some definition of immediately) in their favor. *
In my experience working at prop firm that was trading (speculating) on futures, this is the case. We would enter leveraged short/long positions based on some kind of signals with some kind of risk framework for all assets in the portfolio.
Also a smart shorter will always put in a stop loss price, but stop losses can slide because cryptocurrencies move fast.
1) Actual legitimate Bitcoin payments are increasing and real.
https://blog.bitpay.com/bitpay-growth-2017/
2) Even if this whole thing does collapse, never short something like Bitcoin unless you have unlimited cash to support such a short. Even if you're right, can you continue to sustain your short if the peak is $100,000 a coin before the collapse? (And the new bottom is $10,000, still higher than right now)
If the price goes there, can you afford the short?