Imagine I'm an early adopter with 50.000 BTC (more than 1M usd at today's exchange rate)
Imagine I need to convert very quick that amount to usd or eur
How would you do it?
I've read that many people got their funds stuck at mtgox for weeks. Does not seem a reliable system for a large amount.
And: how could you quickly sell that amount of BTC without causing a huge decrease in the exchange rate?
I happen to have a good deal of trust with the community that I can leverage, so I would simply start making offers on the forums and over-the-counter and get people to wire me money and send them the coins.
Clearly there is a disparity when it comes to whether this would work for the average joe (although, early adopters have a significantly higher chance of not being "average joe").
If I had 50,000 BTC to sell, without the advantage of a reputation to help me sell it, I'd be privately contacting many of the heavy hitters in Bitcoin and privately letting them know I had 50k BTC I wanted to unload, suggest a price more favorable than MtGox, and ask them to give me a call immediately if they later end up with a buyer. I would want to make sure that person ends up making a few percent on the deal, but even so, I'd see a far better return than dumping them on Gox and slipping the price.
Those of us knee deep in bitcoin have the opposite problem: I have people coming to me asking if I can sell them coins, but I don't have any for sale, and I tell them to go buy from Gox or somewhere else. If I had a short-list of people I knew were selling, I'd see an opportunity to swing a few hundred bucks connecting a buyer and a seller, and make both happy.
