If the A invests $1000 in bitcoin, then the next day the price of bitcoin drops dramatically and the A loses $1000, which makes me curious, where does the $1000 A money go?
HAHA I love this question, it's like primary school all over again

I know you shouldn't answer a question with a question, but let this be a riddle for you that will hopefully make you not only get the answer, but understand.
If you buy a used car for $1000 and try to sell it 2 years later with a higher mileage, will it be worth $1000? Probably not.
Now, if you put it on auction for $800, where does the $200 go?
I know that exchange may be looking suspicious to you, because it's not trading physical items, but the principle is the same.