The 38-year-old launched the pyrotechnics while sitting on the ledge of a first floor window of a disused pub being used by squatters.
Dressed in military-style camouflage fatigues, Potts pleaded guilty to one count of throwing a firework in a public place and a public order offence at Manchester Magistrates’ Court on Monday.
He claimed he was given the firework by someone else and lit it “as a mark of respect” to emulate the volley of shots fired at some Remembrance Day events.
Putting him behind bars for 16 weeks, District Judge Mark Hadfield said he did not believe Potts’ story.
He added: “I rather doubt that anybody in their right mind would think letting them off in the middle of that ceremony was a mark of respect.
“It shows a staggering lack of respect for those attending and those being remembered.”
Abigail Henry, mitigating, said Potts, who has 21 previous convictions for 39 offences, had shown “sincere and genuine remorse for his actions”.
She added: “He wishes, through me, to apologise to those present at the service or any wider members of the community who may have been affected by his actions yesterday.
“He describes events on that day being asked by another to set off the fireworks as a mark of respect at 10.59am, similar to the guns used in London.
“It is this very misguided act that leads him to before you today.”
Prosecutor Beth Pilling told the court Potts fired two fireworks – the first resulting in loud bangs, and the second a rocket which flew 15 feet above the heads of the 300-strong crowd at the event.
A group of angry veterans soon gathered outside the pub window shouting, “Get him out” and trying to break the door of the pub down, with others attempting to climb up to the window.
A lone police officer stood blocking the door shouting into his radio as he struggled to hold the crowd back from getting inside before reinforcements arrived.
When Potts, from Borough Road, Salford, appeared at the window to remonstrate with the crowd, a number of traffic cones were launched at him before he retreated back inside.
Police reinforcements soon arrived and Potts was bundled into a police car.
A statement was read out on behalf of a veteran who was at the event and who had served with the Royal Marines between 1965 and 1972 and then with Greater Manchester Police.
The statement from Mr Seed, whose first name was not given in court, read: “I was diagnosed with PTSD [post-traumatic stress disorder] from my time in the forces. The PTSD is aggravated by loud bangs.
“I was blown up twice in the forces and in the police so find loud noises and bangs distressing.
“I was there to place a wooden cross for a friend killed in 1981.
“The occasion was ruined by the most disrespectful act I have ever witnessed at a Remembrance Day.
“I can’t understand why [someone] would do such an abominable act against a group of people like me who have or may have suffered like I have.
“I could hear the words being said by people stood around me, they were very angry and upset by the actions of the male.”
Additional reporting by Press Association