I wouldn't want to short the one asset that's been on an exponential growth curve. It can only go down 100% but who knows how high it could climb. At least put a ceiling on it.
Short selling is a different game. In essence you're betting that the price will go down. Right now the price could go down $500, and you'd make $500. However if the price rose $10,000 you'd lose $10,000.
If you're investing by purchasing the item, then yes, you can only lose 100%. However, if you pay the current rate ( + lending fee ) to borrow a BTC to sell expecting that when you go to repay the BTC you'll be able to purchase one at a much lower rate due to a bubble popping, thus banking the difference, and instead the cost raises exponentially, it could cost you considerably more than 100% of the amount you initially invested when borrowing the initial-sale BTC to buy the BTC you need to replace it.
That is, yes for long positions, no for short sales.
Shorting bitcoin sounds like very bad idea. If you're going to "invest" in Bitcoin, then going long term is definitely the way to go. Even if you invest say right now, but then Bitcoin drops to $300, it's best to keep it a year longer, and then watch it pass $1000 or whatever.
