Thoughts on FBI dumping Silkroad BTC

[traderCJ]

Chances are that the Bitcoins will be auctioned if he is found guilty, like most spoils of illegal activities used as evidence in Federal court.  It will have basically zero impact on market price, like all other off-market BTC acquisitions.

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[ElectricMucus]

I don't think anything of it will end in the hand of any FBI affiliated groups.
Once the auction is announced it should generate quite some press interest making sure everybody gets wind of it. Then dealing with a goverment agency this way leaves very little risk of being defrauded, I think even less than dealing with any Bitcoin exchange. That alone is probably worth something, plus the potential bragging rights of having some of those "FBI Bitcoins"

[outofservice]

http://pando.com/2014/01/02/with-130m-of-bitcoin-wealth-and-plans-to-sell-the-fbi-could-rattle-the-virtual-currency-cage/

Being a government entity you can bet on them trying everything in their power to crash the price when they unload..if for nothing else for fun of it

They will not crash it.

The question is, to whom will they auction/sell?
My opinion is... the US gov and/or US agencies and/or the higher echelon leaders/employees affiliated. The US knows the potential (parliment giving the ok confirms this), they are going to keep it for themselves.  I do not see it being offered to the public, not at all. These coins will stay in their hands or in their control someway.
When I first found out about bitcoin and started reading the take down of the Silk Road and possesion of all those coins was the most major thing that got my attention.. then parliment gave the ok and it went above the 1k mark. These 3 go hand-in-hand, not a coincidence. This!... This (the coins staying within the US) is why and what will catapult (using this word is being very Conservative) BTC to the very generous speculated figure amounts ($10+k, $100+K, etc..) that have been stated on this forum numerous times.
The news of Wall St., Overstock, BTC ATM's showing up all over the world and generating the profits that they have in such a short time, Real Estate agencies taking it as payment, buying Lambo's and trips to space, Central and South Am and the possibility of Amazon taking it as payment is only more reason to get in now and get all you can while it's still in the 3 digit range.

These coins will find their way to the US reserve.

[kkaspar]

I doubt that FBI will sell the coins at all.. They will probably scramble the source and use the coins to fish out criminals from the tor market community or any other criminals that have started to use bitcoin in their ventures. Bitcoin properties give a nice edge to orginized crime in it's efficiency in handling value. I think that in a byrocratic perspective, it's easier to keep confiscated coins and use them as an asset, then to sell coins and buy back coins later when needed.

[empoweoqwj]

I do hope they sell

a) Brings the price down
b) Gets the coins out of government hands

[BTCisthefuture]

I don't think it's likely the FBI would dump all the coins at once, for some reasons stated above.

If they did though it could lead to a decrease in value which could lead to a quick panic sell but news would quickly spread that it was just the FBI exchanging BTC for Fiat and nothing related to anything BAD about bitcoin.  In fact many people would view it as a positive because it would give a signal of bitcoin being more legitimate if a government agency was using it to do exchanges.

From what we've seen in the past from panic sells the most likely outcome is people would quickly buy back in at better prices and the price would rebound fairly quickly. Especially considering in a case like this the price drop wouldn't be related to any bad news , simply a normal transaction taking place.

Also it's worth noting that in a large case like this involving 100's of millions of dollars, an international drug "king pin", and multiple murder for hire charges  this case isn't likely to be resolved anytime soon. It could realistically be years before those bitcoins were no longer needed for evidence in this trial,  by that time it could be true that such a large transaction wouldn't have as much of an impact. Also even ones the bitcoins are no longer needed for evidence (which could be years)  it's likely the government would still debate back and forth a bit on what to do with the bitcoins, and government tends to move very slow so it could also be awhile before they decided what to do with those bitcoins.

[empoweoqwj]

Also it's worth noting that in a large case like this involving 100's of millions of dollars, an international drug "king pin", and multiple murder for hire charges  this case isn't likely to be resolved anytime soon. It could realistically be years before those bitcoins were no longer needed for evidence in this trial,  by that time it could be true that such a large transaction wouldn't have as much of an impact. Also even ones the bitcoins are no longer needed for evidence (which could be years)  it's likely the government would still debate back and forth a bit on what to do with the bitcoins, and government tends to move very slow so it could also be awhile before they decided what to do with those bitcoins.

Might even make the government rich if they hold the coins long enough and bail out the debt

[kinitex]

Them dumping all the coins at once (if they even get access to them) would actually be the best case scenario for us.

We would know it's them dumping, the price would tank, and we would get all their coins dirt cheap and won't have to worry about them any longer.

[johnyj]

Thanks to FBI, currently the US government is already the biggest bitcoin owner when comparing to all the other governments on the planet, they have the biggest motivation to support this economy

[empoweoqwj]

Thanks to FBI, currently the US government is already the biggest bitcoin owner when comparing to all the other governments on the planet, they have the biggest motivation to support this economy

I'm pretty sure they said they were going to sell the coins ..... someone can correct me if they didn't

[Buffer Overflow]

I don't believe they have access to the money so what's to discuss.

What reasons do you have to believe that?

[T.Stuart]

I'm pretty sure they said they were going to sell the coins ..... someone can correct me if they didn't

Why? Do you think they need the money right now? Of course they won't sell. Everybody is bullish for Bitcoin this year, including the FBI! Even all the bears on this forum are bullish! 

There is no way the FBI will sell any coins for at least 2 years in my opinion, and only then might they pass some to the treasury as a way to control the price.

[ElectricMucus]

I'm pretty sure they said they were going to sell the coins ..... someone can correct me if they didn't

Why? Do you think they need the money right now? Of course they won't sell. Everybody is bullish for Bitcoin this year, including the FBI! Even all the bears on this forum are bullish!  

There is no way the FBI will sell any coins for at least 2 years in my opinion, and only then might they pass some to the treasury as a way to control the price.

Basically the FBI has to sell them, unless special legislation would be passed which would allow the FBI to speculate on seized assets, which makes no sense. What remains is using them for some sort of sting operation to flush out other blackmarket sites, but I don't think that is really an option since it's hard to hide where the coins come from.
Are you really that ignorant about how the world works?

[T.Stuart]

I'm pretty sure they said they were going to sell the coins ..... someone can correct me if they didn't

Why? Do you think they need the money right now? Of course they won't sell. Everybody is bullish for Bitcoin this year, including the FBI! Even all the bears on this forum are bullish!  

There is no way the FBI will sell any coins for at least 2 years in my opinion, and only then might they pass some to the treasury as a way to control the price.

Basically the FBI has to sell them, unless special legislation would be passed which would allow the FBI to speculate on seized assets, which makes no sense. What remains is using them for some sort of sting operation to flush out other blackmarket sites, but I don't think that is really an option since it's hard to hide where the coins come from.
Are you really that ignorant about how the world works?

Ignorant? What do you mean? Considering that the US government is working out how to cater for Bitcoin's success do you not think they would want reserves of their own? Right now there is speculation going on with fiat currencies: does that mean that the government or FBI is not allowed to hold fiat currencies?

[empoweoqwj]

I'm pretty sure they said they were going to sell the coins ..... someone can correct me if they didn't

Why? Do you think they need the money right now? Of course they won't sell. Everybody is bullish for Bitcoin this year, including the FBI! Even all the bears on this forum are bullish! 

There is no way the FBI will sell any coins for at least 2 years in my opinion, and only then might they pass some to the treasury as a way to control the price.

Why? Because I read a report saying the FBI intended to sell the coins, that's all.

[addictivegaming]

I think it's pretty clear that they got a hold of the coins as a result of a deal with DPR. He was stupid enough to get caught doing something illegal, but I don't think he was stupid enough to not properly encrypt his wallet.

If I was him, I'd be scrambling to make all the deals I could to avoid spending the next 40 years in prison.

[dnaleor]

Just a thought: can`t we just hard fork bitcoin to invalidate the coins in posession of the FBI? 

[Dalmar]

Scopolamine? Waterboarding at Guantanamo Bay?

 

What about mindreading devices?

Put on your tin foil hats! Protect yourself from the Illuminati.

[JimboToronto]

Scopolamine? Waterboarding at Guantanamo Bay?

 

What about mindreading devices?

Put on your tin foil hats! Protect yourself from the Illuminati.

LOL

I guess we'd better ask Edward Snowden.

 

[T.Stuart]

I'm pretty sure they said they were going to sell the coins ..... someone can correct me if they didn't

Why? Do you think they need the money right now? Of course they won't sell. Everybody is bullish for Bitcoin this year, including the FBI! Even all the bears on this forum are bullish! 

There is no way the FBI will sell any coins for at least 2 years in my opinion, and only then might they pass some to the treasury as a way to control the price.

Why? Because I read a report saying the FBI intended to sell the coins, that's all.

Yes, sorry, there is the "report". But the article is just speculation ( present company accepted). Anyone can see that. So someone made an off the cuff comment to a hack: "This is kind of new to us. We will probably just liquidate them.” That doesn't mean much really. Remember that this comment was, according to the article, immediately after the Silk Road raid, which means before the Senate hearing, recent price rise, etc.

It flies in the face of common sense right now to say that the FBI will just "liquidate" their stash.