US Marshall's Bitcoin Auction Results

[BitchicksHusband]

This may or may not be relevant to the thread, but why did Ross Ulbricht give up his passphrase to the silkroad wallet? If the FBI won't allow him to ever access those bitcoins again, then delete the wallet. Why give them to the FBI? It's not even their right to profit off this.

Well, normally they sneak in and plant a keylogger on your PC while they are watching you as a suspect.  But these coins were from the website, not his personal stash.  They could probably figure out the address from the source code, watching memory as the software opens the site wallet.  They are being auctioned because nobody claimed them (who would?).

[BitchicksHusband]

This may or may not be relevant to the thread, but why did Ross Ulbricht give up his passphrase to the silkroad wallet? If the FBI won't allow him to ever access those bitcoins again, then delete the wallet. Why give them to the FBI? It's not even their right to profit off this.

From what I know (and correct me if I'm wrong because I'm quoting this from memory):

- The coins that were sold above were seized from the Silk Road server. They were seen as proceeds of crime so naturally they took them. If Ross admitted that they were his coins he pretty much loses the case. When they apprehended Ross in the library he was logged on to SR and some other panels he used, I'm guessing the wallet was decrypted at that point. I don't know if they transferred the coins right then or by obtaining the password at a later date.

- Ross had a separate batch of coins that weren't on the SR server and he's adamant those are his own coins.

Either way, as no one has come forward claiming the coins found on the SR server and it's property used in crime they're allowed to sell it - I don't know the exact legislation behind it but it happens all the time when seized goods get auctioned off.

It'll be really interesting to see what affect this has on the market.

True, although it's wrong to assume that all the money was for 'crime'. Firstly, it was a global marketplace, and a Portugese citizen buying most drugs isn't illegal in Portugal. For another, a good amount of money was for electronics, not drugs, which aren't illegal (yet).

Selling drugs in America (even to Portugal) is a crime.

Money laundering drug money (by tumbling it) is a crime.

All the money is seen as criminal because of this.

[BitchicksHusband]

My question is HOW THE HELL did they seize the other 140K ish coins?
I mean, he doesnt have some backup of the wallets or they are like hot wallets
for the servers?
Either way, the fact they got them and the wallets werent encrypted and he doesnt
have some uber safe dark cloud storage of the wallets for cases like this is shocking.

Im amazed they got that many coins that easy and they were just sitting open on the
PCs or servers they seized them from?  Kinda shocking to me honestly but I dont know
the whole story yet.


E.

Again, he was watched for over 2 years.  A keylogger will easily reveal your bitcoin passwords.

[nwfella]

Really interesting to me that bitcoin price has actually been going up.  I really suspected one or more big bag holders would try to induce some panic sell's to try and drive the price down in an effort to buy back in really low.

Will be interesting to see whether or not any of these winning bid's actually disclose any real figures insofar as what they paid at auction.

[ajareselde]

Really interesting to me that bitcoin price has actually been going up.  I really suspected one or more big bag holders would try to induce some panic sell's to try and drive the price down in an effort to buy back in really low.

Will be interesting to see whether or not any of these winning bid's actually disclose any real figures insofar as what they paid at auction.

there are still no real results on auction prices that would make us confident that buying is a good option now.
i think its better to wait than to trade until we actualy know something worth knowing.

[DannyElfman]

Really interesting to me that bitcoin price has actually been going up.  I really suspected one or more big bag holders would try to induce some panic sell's to try and drive the price down in an effort to buy back in really low.

Will be interesting to see whether or not any of these winning bid's actually disclose any real figures insofar as what they paid at auction.

there are still no real results on auction prices that would make us confident that buying is a good option now.
i think its better to wait than to trade until we actualy know something worth knowing.

I would argue that bidders who did not win the auction will buy at least a portion of the coins they tried to buy on exchanges

[mkc]

Has the price been confirmed yet, or still just rumors?

[Searing]

Heh if i was bill gates (or equiv) and wanted to get in on bitcoin from the us gov't with a certificate
even (all clean coins) etc etc ..

I'd buy all the lots high price as a hedge and not tell anyone and lmao

of course I'd likely be dead from drugs/booze and hookers if I suddenly had that much $$$ but
reality aside this is a 'what if' question

Searing

[RiverBoatBTC]

Second Market Guy said they lost at below spot, he did not go on to say what the actual bid was though. My guess is they went at spot or maybe a little higher.


THIS IS JUST A GUESS

[_smudger_]

http://www.itweb.co.za/index.php?option=com_content&view=article&id=135754:SecondMarket-Pantera-outbid-in-Bitcoin-auction&catid=69

SecondMarket and US investment firm Pantera Capital, two of the more prominent bidders in the US Marshals Bitcoin auction, on Monday said they were outbid in their attempts to buy some of the nearly 30 000 coins sold late last week.
The rejection of two of the biggest names in the Bitcoin industry is a potentially encouraging sign for the long-term prospects of the crypto-currency because this means the auction drew a lot of interest from other institutional as well as new investors.
Click Here
Pantera Capital CEO Dan Morehead told Reuters the firm was unable to purchase the Bitcoins because its bid was below the market price.
"The point is when this auction was announced, Bitcoin was trading at $634 and the general view was that the supply would take the price down," Morehead said.
"But ultimately, the supply increased the demand for Bitcoins and now the price was higher than when the auction was announced."
  See also


On Friday, the US Marshals Service auctioned off about 30 000 Bitcoins seized during a raid on Silk Road, an Internet black-market bazaar where authorities say illegal drugs and other goods could be bought. The Marshals Service said it was notifying winners on Monday evening.
A spokeswoman for the US Marshals Service said on Monday the 12-hour auction for about $17.7 million in Bitcoin drew 45 registered bidders and received 63 bids but would not disclose the bidding price of the coins.
"The award process is ongoing, and we will have no further announcements today," said Lynzey Donahue, a spokeswoman for the Marshals Service.
Barry Silbert, founder and CEO of SecondMarket Holdings, which runs a Bitcoin investment platform, confirmed in an e-mail to Reuters on Monday that he tweeted earlier his firm had been outbid for the Bitcoin auction on all blocks. Silbert had made no secret of his desire to bid in the auction, so his firm being outbid suggested interest was likely strong.
Bitcoin prices were up 6.8% on Monday at $639.32, according to the digital currency exchange CoinDesk. The currency's price rose late in the afternoon in advance of expectations for the sale's results.
"The Bitcoins that were auctioned off would be in good hands," said George Samman, COO, at BTC.sx, a Bitcoin derivatives trading platform.
"The investors will provide the stability to the industry and reduce volatility in the market. These people will probably hold the Bitcoin over the long haul and that's good for the industry."
Bitcoin is a virtual currency that has gained a following but also has come under scrutiny due to scams related to virtual currencies. However, its acceptance has grown, with satellite operator Dish and online travel agency Expedia recently saying they would accept payment in Bitcoin.
Among those who said they registered to participate in the auctions were Bitcoin Shop and Coinbase. Both declined to comment.
Silbert had attracted a group of investors interested in getting a share of the Bitcoin auction by offering lower bid sizes and a reduced upfront commitment. In a tweet last week, he said he received 186 bids from 42 bidders.
Silk Road was shut after an FBI raid in September 2013 as agents took control of its server and arrested a Texas man, Ross Ulbricht, that the authorities said owned and operated the Web site.
The auction was for 29 655 Bitcoins contained in files residing on its servers, which were forfeited in January.

[_smudger_]

More...

....The U.S. government auction created a tremendous amount of new demand for bitcoin,” Pantera’s Dan Morehead told The New York Times. “Most of the people we spoke to were new entrants to the bitcoin market. None of our bids were hit. I think it went at quite a high price.”...

https://www.finalternatives.com/node/27493

[johnty82]

All I could find out was it must have been over $403 for at least one block.

http://dealbook.nytimes.com/2014/06/30/after-bitcoin-auction-winning-bidders-remain-elusive/?_php=true&_type=blogs&_php=true&_type=blogs&_r=1&

Mr. Waters of CoinApex, who bid as an individual, appeared to send his bid using his cellphone while live on Bloomberg Television on Friday, but later confessed in an interview that he had forgotten to attach the bidding form to his email. He submitted his bid for one block of Bitcoins, at a price of $403 each, later on Friday afternoon. He, too, did not win

Even the bidders don't seem to know who won yet. The nypost says plans to alert the winners by the close of business on Monday stalled

http://nypost.com/2014/06/30/feds-put-bitcoin-auction-bidders-on-hold/

But plans to alert the winners by the close of business on Monday stalled.

“The award process is ongoing,“ Donahue said.

“Not today,” confirmed another spokesman for the Marshals Service. “I’m not at liberty to say why. The process is still ongoing,” he said.

[weisoq]

So no winners have declared yet. How do we know they hit anyone's bid?

[RiverBoatBTC]

I am going to put my guess in that these  coins sold at spot... Just a feeling I have.

[JorgeStolfi]

What the heck, if everybody is guessing on thin air, I may as well:

(1) There were a few bids by irrational individuals well above market price, say 800 $/BTC or more.  (I say "irrational" not becaue of them valuing coins so much, but because they could buy the coins for less than that at the exchanges, with slippage and all, either directly or through brokers.)

(2) Most of the bids where by rational bidders, individualor corporate, who bid at about the current market price, or somewhat below that, say in the 550-630 range.

(3) Some of the bids were well below market price, by people who thought 'hey, why not try, I may win the lottery'.

(4) One or more of the highest bidders failed to send the full amount in time, and that is why the auction stalled -- the USMS had to notify the next bidder, and give him another day or two to pay.

[hellscabane]

I wonder if the people who made offers for $800+ were also trying to get multiple auction blocks. I'm not sure if that would even by allowed by the auction format, but that is the only "justification" I can make for buying blocks at $800+.

[johnty82]

What the heck, if everybody is guessing on thin air, I may as well:

................

One or more of the highest bidders failed to send the full amount in time, and that is why the auction stalled -- the USMS had to notify the next bidder, and give him another day or two to pay.

That sounds like a good guess to me.

[JorgeStolfi]

I wonder if the people who made offers for $800+ were also trying to get multiple auction blocks. I'm not sure if that would even by allowed by the auction format, but that is the only "justification" I can make for buying blocks at $800+.

The bid form allowed one person to specify any number (0-9) of 3'000 BTC 'A' lots, all at the same price, and optionally the 2'655 BTC 'B' lot., at some other price.  But a person could submit as many forms as he wanted, with different prices.  Obviously if all his forms added to more than 9 A blocks and 1 B blocks, some of his bids would never win.

Any rational person who believed that bitcoins were worth buying at 700$ each, and had some millions lying around, should be buying all he could the exchanges, independently of him entering the auction or not, until the market price reached 700$.  Also, a rational person would not post a bid of several million dollars without having the full payment amount ready in the bank, because otherwise he would risk losing his 200 k$ deposit for nothing. So we can guess that bids well above market, if there were any, were not posted by rational persons.

[johnty82]

The marshall's service had pretty stringent payment rules with a strict deadline. Someone could have missed the payment deadline if they had problems withdrawing such a large amount of money from their bank.

[BurtW]

The bid form allowed one person to specify any number (0-9) of 3'000 BTC 'A' lots, all at the same price, and optionally the 2'655 BTC 'B' lot., at some other price.  But a person could submit as many forms as he wanted, with different prices.  Obviously if all his forms added to more than 9 A blocks and 1 B blocks, some of his bids would never win.

It is true that on one form you could bid for multiple lots at one price, but...

If you wanted to bid at different prices then you needed multiple forms and you would then have to make multiple $200,000 deposits - one for each form.

I think the $200,000 per form deposit probably made most people fill out just one form = one bid price on one or more lots.