Bitcoin Forum

http://www.usmarshals.gov/assets/2014/bitcoins/

http://www.forbes.com/sites/kashmirhill/2014/06/12/silk-road-bitcoin-on-the-move-as-government-prepares-to-auction-off-18-million-worth/

And you can see that the coins were moved, here:
https://blockchain.info/address/1F1tAaz5x1HUXrCNLbtMDqcw6o5GNn4xqX
https://blockchain.info/address/1FfmbHfnpaZjKFvyi1okTjJJusN455paPH



Gonna be a nice few days for the US bitcoiners :) Wish I could get this piece of Bitcoin history.

They are just auctioning off the small part of the bitcoins too.  The US will still have a huge stash. 

Does anyone think it is funny that in the movie the DPR would just be a pirate long enough to get rich and then he would retire and live a comfortable life.  Where as the Silkroad DPR just kept on going and going until he was the largest holder of bitcoins in the world (except Satoshi).  By then, yes, of course he would get caught. 

wondering how the gov. get the private keys from the silkroad owner

Arrested him and thretend to maximize punishment if he doesnt give it up. As simple as that.

Hopefully an investment fund will step up and take them (at a premium :) )

At least they auction them in bulks, one can hope that big whales pig them up and stash them away, it would be nasty if they just dumped all of them on the exchanges.

They auction it for cheaper price ?

Well, since it is a auction, then is the final price not know yet...

http://xkcd.com/538/

Better if an genuine investment fund bought them and made it public. This would be fantastic for BTC

That is an "unknown" type of link that is sometimes dangerous. Do you have a relevant paragraph to quote, or a link to a more familiar site? Thanks

more familiar than xkcd? You're kidding, right?

Onkel Paul

Seriously?
xkcd.com is a very popular Comic Strip.

I just didn't figure out, how to emb the Picture(or was too lazy to figure it out). Here you go.

http://imgs.xkcd.com/comics/security.png

Nice one, thanks.
Seriously?
Yes, it is possible to spend a lot of time on the Internet and still not hear/see everything.  :)

I prefer my comic strips to have faces, whoever creates them on xkcd must have some psychological issues?   ;D

Isn't this auction causing people to expose their personal information to the US government that a lot of them otherwise seem to hide?

This appears to be another good way for the US government to collect information about high financial players of bitcoin and I would expect a lot of people wouldn't want to go anywhere near this auction..… combined with such short notice, this may keep bidding very low and give the winner(s) more of a reason to dump them at market value for a nice profit

There is the other side.  :)
Savvy "mainstream" wealthy people, some of whom would never consider using a typical Bitcoin exchange, now have a chance to pick up amounts of BTC which they expect to hold for Huge gains. This helps reduce the overall supply even more, and the party rolls on...

Yes this is basicly most legal way in US to buy BTC right now. Noone cant ask you anything after this.
"Sir where did you get your BTC from?"
"F fuckin BI"!

Don't forget they're gonna tax it for you ;) And will probably be the most non-anonymous coins out there.

Wish I could get in on this action. 

Alas I don't have the minimum $200,000 to place a bid.   :'(

Interesting to think how this will affect bitcoin prices
On the open market.

First instinct is to say OMG they are making huge sells.
Second thought is, it's  a private sale, and will be met with a private buy.
It won't touch the open market.

On the other hand, investors that buy their coins
from the FBI arguably would have done so on the open
market and driven price up more, so we'd miss that...

...but... Then again, buyers may get a discount because
buying these coins are a big pain and less anonymous,
So may attract additional dollars into bitcoin.  Also it
may generate press and more investors.

overall, I'm not expecting any huge price moves when
The auction takes place.  

People definitely won't get cheap coins this way. It's an auction, they'll probably end up paying more than they would on Bitstamp or another exchange.

I guess it will be a private sale.  That is actually REASSURING to me regarding the price because it means they won't just be all dumped at once at an exchange.  But I do think the bigger investors will look at the price and try to extrapolate it to the exchanges.  In other words if the auction goes for way less than $600/btc then the exchange price will drop.

I'm sure it won't go below the market price. If anything, it will go above.
That said, the coins won't be dumped unless there's some profit to it.

$200,000 is just the deposit in order to be able to bid.  You will be bidding on a lot of 3,000 BTC so you will need somewhere between one and two million dollars cash (333 USD/BTC to 666 USD/BTC) in order to participate and have a chance of winning one of the 10 blocks of 3,000 BTC.

I can't take credit for this because I believe it was Danny_Hamilton who said it, but the entirety of the Silkroad coins that were seized 120k+ is ~ what is generated by the blockchain in 48 days. I wouldn't expect this to have an enormous impact on the exchange price. Unless someone ends up buying the coins for insanely cheap, which won't happen their will be competition for them.

That's right. It's just money changing owners, this happens every day and doesn't affect the market. Even if somebody wanted to sell I doubt he'd just pick an exchange and drop everything in 1 day. He'd just lose the money.

Around ~172800BTC are generated in 48 days, with the current reward per block. It's a bit mind boggling...
On the topic of the auctioning, I'm glad that at least their not dumping it all at once. Guess they realised that it might be counter-productive for them to do that.

Yea I figured that $200k just gets you in the door.

That's why I'm sad, because I'm not rich... :'(   :P

they will go near market value, above or below, that depends on the demand.  The fact is that if you try buying or selling this huge amount, you drive the price up or down respectively.  If you tried buying this amount of BTC on the open market at once, you'd end up paying thousands and thousands on average per BTC.

So think about if folks, these auctions will have no effect on the market, stop biting your fingernails these auctions happen all the time for all kinds of things.  No one is dumping anything.

The news drives the price down as investors - like me - sell in anticipation of the price dropping (self fulfilling prophecy) and when the sell off slows we buy back in and the price returns to normal or slightly higher. Same old same old.

Sukrim set up an interesting contract last night about the auction and pricing of the 'Blocks':


https://www.betmoose.com/bet/silkroad-coins-will-be-sold-above-market-value

I wouldn't be surprised if they go for higher than market and that if one person is able to get multiple blocks.  There are a lot of rich people that could put down a couple million and not even think about it.  This is a perfect chance for big money to come into bitcoin. 

I'm not looking forward to what happens to the price after this auction. Look what happened just on the announcement.

After the auction, and something that can be touted as a resolution on 51% hashrate, the price will rally back over $600. I'm betting - literally - that the floor will be around $475.

The price probably all depends on how much they go for and what the person does with them. If he dumps them we could see trouble.

Buying and dumping makes no sense as he is selling such an amount that he is driving down the price as he sells and so will get much less than he paid. Unless 'his' plan is to drive down the price and then buy back in from the panicking "dumb money" and in the end driving the price back up. If that's the plan I'm all for it. I'll end up with more bitcoin (buying low) and the bitcoin will be stronger for having appeared to weather another storm.

My guess is that the auction will close quite a bit below market price. That seems to be the rule for government auctions in general.

It is unlikely that it will close above market price, because one can buy 3000 coins on the open market with a bit of patience.

Plus if the current downtrend/volatility continues until the auction, it would be very risky to buy such lots at or above market price.

Large investors who may need (say) 12'000 coins for some startup probably already have bulk sources, that sell at or below market price (e.g. miners), so they probably would not be interested in paying more at the auction.

Probably some of the lots will be bought by speculators who will then try to sell them on the open market, gradually.

Maybe the winner bidder wont have any idea what he's doing? I'm sure whoever wins them though will probably be keeping them as an investment. It'd be hard to sell many of them straight away as the price will go down.

Has this do s.th. with the dropping BTC price atm?

I wonder if anyone will actually bid on them.

I guess there will be bidders, yes.  If someone managed to get one lot for 300$/BTC, right now, he would make a nice profit by selling on the open market, even with slippage and falling prices.

There is no cost for bidding and losing. There is paperwork and hassle and freezing 200'000$ for a month; but there are many people, including "professional" auction bidders, who are not scared by those things.

While there may be some lottery winners that haven't managed to lose all of it yet, most people with that kind of coin know what they are doing.

https://www.betmoose.com/img/bet-image.jpg (https://www.betmoose.com/bet/silkroad-coins-will-be-sold-above-market-value)___________

SilkRoad coins will be sold above market value (https://www.betmoose.com/bet/silkroad-coins-will-be-sold-above-market-value) Options: Yes (https://www.betmoose.com/bet/silkroad-coins-will-be-sold-above-market-value#1) | No (https://www.betmoose.com/bet/silkroad-coins-will-be-sold-above-market-value#2)

Lots of factors to consider, including price manipulation ahead of the action.

Sorry if you consider it spam Holliday, it's a completely P2P platform so I'm just trying to give people the opportunity to match up with others. This is how prediction markets work, and ideally, if everyone participated, you would have your answer to how much the coins are sold for before they're sold.

I can easily see that some bitcoin companies will want to pick up a lot if they can get them for below market.  Coinbase being one.  They are constantly needing a bigger cold wallet.  It would be good for them to have some padding. 

One thing is for sure.  Whoever buys these aren't going to be buying hotel rooms and cable TV with their bitcoins. 

I wish my bank would give me a 2 million dollar credit line.  I would bid, win, default on the loan, and run away until statue of limitations expired. Hahahaha

Did you really wonder?

SecondMarket is in:

https://bitco.wufoo.com/forms/participate-in-us-marshals-bitcoin-auction/


https://twitter.com/barrysilbert/status/477931080889012224


https://twitter.com/barrysilbert/status/477931146030743552

Too bad its a silent auction. No bidding wars.  1 bid is submitted, highest bid wins.

is it me or does it look like the FBI wants to give their friends coins on the cheap? it's like they're not going to even try to get the most out of the bitcoins they own.. and are they going to disclose who buys them at what price, or is that private?

No more for bitcoin than for any other merchanise.  It is not part of their mission to make a profit from sales of seized stuff.

Why do people think that the FBI views seized bitcoins any different from seized cash, gold, stocks, etc?

FBI guy:  How are we going to get rid of these things.
USMS guy:  How about 10 lots of 3,000 each, highest bidder, silent auction?  That will be the least amount of work for us.
FBI guy:  Sounds good.

That is probably pretty close to what happened.  Those FBI agents don't get a fee, they will get paid the same amount whether it sells high or low.  Like many government employees (actually like most people), they just want to do the least amount of work possible. 

Yes, that's is the spirit.  :D ( A fellow government worker there?  ;) )

Although the dialogue may have been more like:

FBI: We got some seized bitcoins cleared for auction.  You guys know how to handle that stuff?
USMS: Yes, no problem, the auction could not be any easier. Just send the coins, I'll email the address.
FBI: Good! Thanks, bye.

I hope they accidentally send them to the wrong address and they keep the winning bidders money. Here's how that conversation will go.

US Marshall Supervisor: Fred, I thought you told me you knew how to work that Bitcoin stuff.

Auctioneer: Yeah, I do. The FBI told me how to do it.

US Marshall Supervisor: Well, one of the winners is bitching that they didn't get the things. They say they tracked them in the blockhead to some guy named Mark Karpeles. Did you type in the code thingy right?

Auctioneer: Oops! Oh well, what are they gonna do sue us.

Background laughter heard from everyone in the room.

as i mentioned, they could have wealthy friends (i mean, come on, they are in the FBI) who could use a little insider info to make profits from buying these bitcoins cheap.

\

I was wondering the same exact thing myself, stealing ones wallet does not give you their coins, and a person who is notorious of Silk Road would not just makes things so easily accessible, I think what really happened here is as follows

The US Government bought all those coins when the bitcoins surge began, they have held them until a time appropriate for them to sell them, and needed a way to do so, offered Silk road a plea bargain to agree to their terms (that part is speculation) for silk road to say yes their coins were seized, they are now using this silk road situation to sell the coinsthey bought with taxpayers money without telling them the gamble they actually took with all the tax dollars.

Does this seem to wrong, maybe eveen on the lines of conspiracy, well think about this, 401K plans, what happened there, or even worse yet the stimulus packages, what most people dont understand is both of those situations were exactly the same HUGE gambles with tax payer dollars, buying stocks with your retirement, then loosing it all on your end while gaining like theives in the night on their end, they put your retirement into a market they colluded, and stacked against your own retirement and filled their pockets and the bankers pockets who raised the situation to congress in the first place

the stimulous packages were no different, companies got X amount of dollars in return those companies ahd to give X amount of stocks to be controlled by the US treasury, some worked out well others failed dramatically like all GM and GMC owned stocks failed and fell thru the floor loosing the US tax payers a lot of the money that was given in the stimulus packages.

It was nice to see tho, this bitcoin venture they invested in worked out for the best for them.

You're crazy. There are millions of better ways the government can speculate or invest into BTC.

You are correct, there are many plausible and logical ways for the US Government to  invest in bitcoins and keep the information of these moves public, but when has anyone ever known the US government to do things that were logical?

Looks as if we've had some insider trading in the past couple of days

Maybe, no one  can  guarantee

And they have no reason to do so.  Just as they have no reason to speculate or invest in Apple stock or rare stamps.

It's easier to print money :P
I still don't get it how they can be one of the most powerful countries with such government.
Really makes no sense to me. Maybe it's because I haven't seen how they actuay function, but you can't be in such debt and doing nothing to actually get out of it.

I think it has something to do with the fact that the dollar is the world reserve currency.  But they can't keep piling on more debt forever.  Other countries are already starting to stop taking on new dollar debts.  China said something a few months back about that.  They don't want to just pull the rug out though cause that would make their holdings worthless if they completely crash the dollar, plus we buy a lot of their goods , so it's an interdepency but I think they are trying to wean themselves off the dollar.

Second Market is accepting bids for aggregation:
https://bitco.wufoo.com/forms/participate-in-us-marshals-bitcoin-auction/

would be funny if the FBI dude comes on here complaining he got scammed and wished he used escrow :p

LOL! Imagine that to happen.
Knowing the feds, that actually could happen :D

This is the norm in how seized assets are sold.

The US Marshals takes possession of the assets, they make an announcement regarding the up coming auction along with the details of the auction, they hold the auction in a similar manor.

Any ideas on WHO (or at least what TYPE) of buyer it will be?

Anyone up for a group buy?

You can participate here:

https://bitco.wufoo.com/forms/participate-in-us-marshals-bitcoin-auction/

Thanks

But how would the group decide on the bid price?

If it is a large informal group, it may include spies who will tell competitors what the group plans to offer, and they will bid 0.01$ higher.

The group would have to choose a trusted manager, who will decide the bid price without telling anyone in the group.  If he loses the auction because he bid too low, or people lose money in the end because he bid too high, would the group forgive him?

I cannot see how this matches the USM requirements of knowing and approving bidders.  If they are really bidding for a group and disguise that they will be lying to the government.  If the group is large and they honestly name the members and one is not eligible would not that invalidate the whole group?   

I'd be up for a group buy if we lowball an offer. 

The flaw with a group buy is that everyone will be unrelated to eachother and many questions would need to be resolved in a very short period of time.

this could happen!

Indeed it seems complicated.  Each member will have to hand in upfront some fraction F of 200'000 dollars, and if the group wins the auction he MUST immediately wire in F times  3000 times X, where X is the price that the group bid at (which of course the member cannot be told in advance), so that the group can send the total to the USMS by wire -- all that in a very short time.

If one member fails to pay, or has the payment delayed the entire group loses the auction AND their deposits. 

So it seems that every member will have to send to the group leader, right from the beginning, a sum greater than F times 3000 times the maximum X that the group leader is allowed to bid.  But that maximum X cannot be much lower than the estimated market price at the date of closing, otherwise competitors (who can easily infiltrate a spy) will outbid the group.

In order for a group buy to be successful the funds would need to be pooled prior to submitting the group's bid.

There is realistically not enough time to coordinate a group buy. The winning bidder will likely receive somewhat of a discount, however I don't think it would be so massive that it would be the deal of a lifetime.

Not sure how SecondMarket does it but they did it.  In increments of $25k or $50k depending on various people you talk to.  I'm part of a group.  Bids were due today at noon.  We made our bid and find out Monday if it got accepted.  I'll reveal bid amount Monday after we know if it was accepted or rejected.

second market is making bids for the blocks. Their bids will be based on how their investors want to bid and second market will not have any direct control over the bid amount.

Previously second market was only selling bitcoin in blocks of $25k

We bid $455 which at the time was 81% of market value.  Not accepted of course.  Rumor has it winning bid(s) was at spot or maybe even above spot.

There was *one* winner: https://twitter.com/paulvigna/status/484074892946837504

Details to come soon, apparently.

All coins were moved in a single tx: https://blockchain.info/tx/9e95c3c3c96f57527cdc649550bf8e92892f7651f718d846033798aee333b0c3 (https://blockchain.info/tx/9e95c3c3c96f57527cdc649550bf8e92892f7651f718d846033798aee333b0c3)

i'm guessing the winning bidder went over spot.. was probably around what it is right now at $650. a lot of people are paying attention to the whales to get a feel for the consensus of what they're willing to spend, and if it turns out to be $650, then bitcoin will jump to that price.

What makes you say this? I would say that the majority of bidders likely bid under the price as of when they submitted their bid. As of the time of the bid there was selling pressure on the market and any participant could have purchased coins at the market price

Rumor said one person bid $900, is he the winner? I guess if he bid one lot at $900, all other @625, then the final price will be 625, am i right? We all expect some bullish move when the price released.

Here's my take :)


Speculation is starting to arise regarding the identity of the sole winner of the 30,000 bitcoin auction that was held by the US Marshals Service. The objective of this auction was to liquidate the bitcoins which were seized from the Silk Road back in October 2013. Who is this mysterious investor that outbid everyone else for $19 million worth of bitcoins?

The mere fact that one bidder, out of 42 others who put down a deposit of $200,000, won the entire auction has important ramifications on what’s to come. These bidders who have indicated a clear interest in buying bitcoin in large volumes will now be left to satisfy their demand on the open market. This could lead to a continuation of the uptrend that was started on Monday. However the question still remains: Who is this person that won all 30,000 bitcoins and what will they do with them next? According to the blockchain, the bitcoins have already been transferred and the deal is complete.

... Continue Reading:
http://altcoinauthority.com/2014/07/who-won-the-usms-silk-road-bitcoin-auction/ (http://altcoinauthority.com/2014/07/who-won-the-usms-silk-road-bitcoin-auction/)

It seems very dangerous to bid @ 900; what you do is you bid @ the maximum you are interested or a bit higher


Reading the weird messages from the dust transactions to the address is entertaining ;D

It is good the FBI coins are not sold on the market because it seems to find new buyers and to support the price, maybe it will even be the same if the 100,000+ bitcoins that the FBI still have are auctioned off

Is this going to fuck up the market?

This represents a little over 1% of all bitcoins. I would say yes it will

So buy when it hits the lowest point then?

Always a good plan

That's another great advantage of bitcoin over the obsolete payment systems.  You would never get such fun as spam, hate mail, and mockery on you bank account statement.  Anonymous messages that you cannot erase and everybody can read.  Way to go, bitcoin.  :P

As a teen I occasionally amused myself by writing cryptic, humorous or prankish notes on paper currency.

No you would pay the amount that you bid as long as it is the highest.

You are thinking about how ebay's auctions work in that if the next highest bid is $600, then you would only pay one increment above that bid.

This probably will double the number of bitcoins in circulation on the other hand

It would not double the number of bitcoins in circulation, but in theory will make the bitcoins in circulation more diverse as Draper is going to try to get people to use bitcoin who do not currently have access to bitcoin

protip: just because something is visible at blockchain.info, that something is not necessarily embedded in The Blockchain.

Thanks for the correction.  Does blockchain.info provide a way to protect people from such unwanted associations?

Even if it is not embedded in the blockchain, blockchain.info is large enough so that the public notes work well enough for this purpose.

But it *is* possible to embed messages in the blockchain, isn't it? Only it is strongly discouraged, I gather?

The big question is - will it be sold at street value, or will they have a bid war to the top?

I would say that it is less discouraged and more that you would really need to know what you are doing to even be able to decode the message, making it a bit of a moot point if you are trying to communicate to the masses

READ THE THREAD.

Apologize for not reading the whole thread...

Is the coins sold, and what was the price per bitcoin (approximately)?

http://www.cnbc.com/id/101816404#.

Thank you sir  :)

Despite the expense, Draper calls himself a "believer."

How great! Nice read, thanks.