What Would You Have Bid For The USMS Seized BTCs?

[Hfleer]

I believe that anybody that would have bid below-market or at-market rates would not have won the auction.The alternative of buying 50,000 coins on the exchanges would drive the price way up, so bidders were already willing to pay at least market rate. In fact, it is possible that the recent rise is the result of auction losers buying on exchanges.

That assumes that there are people who want to buy 50000 coins and would have to otherwise buy on exchanges.

I am pretty sure that this is a rare case.

you are being very, very kind.

I'm guessing the USMS chose the avenue they traveled expecting to get about 50% to 70% LESS than the face value of the merchandise. If they wanted face value they would have sold it on the open market little by little like anyone else seeking face value.  The also could have advertised a minimum bid of $200 so that everyone knows they want face value plus.  But none of that happened because they knew they would not get it.  Not just because all of 2014 was a buyer's market, and not because if they sold everything at the same time in the public market they would OBVIOUSLY get less in the aggregate, but because no one in with that kind of money is buying wholesale quantity at retail prices -- it's a fire sale auction NO ONE in their right mind expects to pay anywhere close to "market" value for anything at a "must sell" auction.

Actually they always got close to face value in previous auctions of BTC. So maybe they did again this time.

My point was that above market is unlikely, close below market is very likely and even 10% away from market is pretty much impossible due to arbitrageurs.

[Armis]

I believe that anybody that would have bid below-market or at-market rates would not have won the auction.The alternative of buying 50,000 coins on the exchanges would drive the price way up, so bidders were already willing to pay at least market rate. In fact, it is possible that the recent rise is the result of auction losers buying on exchanges.

That assumes that there are people who want to buy 50000 coins and would have to otherwise buy on exchanges.

I am pretty sure that this is a rare case.

you are being very, very kind.

I'm guessing the USMS chose the avenue they traveled expecting to get about 50% to 70% LESS than the face value of the merchandise. If they wanted face value they would have sold it on the open market little by little like anyone else seeking face value.  The also could have advertised a minimum bid of $200 so that everyone knows they want face value plus.  But none of that happened because they knew they would not get it.  Not just because all of 2014 was a buyer's market, and not because if they sold everything at the same time in the public market they would OBVIOUSLY get less in the aggregate, but because no one in with that kind of money is buying wholesale quantity at retail prices -- it's a fire sale auction NO ONE in their right mind expects to pay anywhere close to "market" value for anything at a "must sell" auction.

Actually they always got close to face value in previous auctions of BTC. So maybe they did again this time.

My point was that above market is unlikely, close below market is very likely and even 10% away from market is pretty much impossible due to arbitrageurs.

What they reasonably expected to get and what they got could be two totally different things, every blind auction is a hail mary pass; you throw it because you want it to work not because you expect it to work and when it does connect you are as shocked as everyone else in the whole stadium.

Anyone in BTC market knows values could easily swing 15% in a week and 20% over the span of a month.  So would be unwise to make a blind wholesale bid of anything close to public market value.  If all of 2014 the market trend was down, down, down; only recently did it do an about-face and go up, up, u [stuck at $299].

[Hfleer]

I believe that anybody that would have bid below-market or at-market rates would not have won the auction.The alternative of buying 50,000 coins on the exchanges would drive the price way up, so bidders were already willing to pay at least market rate. In fact, it is possible that the recent rise is the result of auction losers buying on exchanges.

That assumes that there are people who want to buy 50000 coins and would have to otherwise buy on exchanges.

I am pretty sure that this is a rare case.

you are being very, very kind.

I'm guessing the USMS chose the avenue they traveled expecting to get about 50% to 70% LESS than the face value of the merchandise. If they wanted face value they would have sold it on the open market little by little like anyone else seeking face value.  The also could have advertised a minimum bid of $200 so that everyone knows they want face value plus.  But none of that happened because they knew they would not get it.  Not just because all of 2014 was a buyer's market, and not because if they sold everything at the same time in the public market they would OBVIOUSLY get less in the aggregate, but because no one in with that kind of money is buying wholesale quantity at retail prices -- it's a fire sale auction NO ONE in their right mind expects to pay anywhere close to "market" value for anything at a "must sell" auction.

Actually they always got close to face value in previous auctions of BTC. So maybe they did again this time.

My point was that above market is unlikely, close below market is very likely and even 10% away from market is pretty much impossible due to arbitrageurs.

What they reasonably expected to get and what they got could be two totally different things, every blind auction is a hail mary pass; you throw it because you want it to work not because you expect it to work and when it does connect you are as shocked as everyone else in the whole stadium.

Anyone in BTC market knows values could easily swing 15% in a week and 20% over the span of a month.  So would be unwise to make a blind wholesale bid of anything close to public market value.  If all of 2014 the market trend was down, down, down; only recently did it do an about-face and go up, up, u [stuck at $299].

So, you would NOT buy a big amount of BTC in one month at -20% if you had to pay for them today, with delivery in 1 month?

[Armis]

I believe that anybody that would have bid below-market or at-market rates would not have won the auction.The alternative of buying 50,000 coins on the exchanges would drive the price way up, so bidders were already willing to pay at least market rate. In fact, it is possible that the recent rise is the result of auction losers buying on exchanges.

That assumes that there are people who want to buy 50000 coins and would have to otherwise buy on exchanges.

I am pretty sure that this is a rare case.

you are being very, very kind.

I'm guessing the USMS chose the avenue they traveled expecting to get about 50% to 70% LESS than the face value of the merchandise. If they wanted face value they would have sold it on the open market little by little like anyone else seeking face value.  The also could have advertised a minimum bid of $200 so that everyone knows they want face value plus.  But none of that happened because they knew they would not get it.  Not just because all of 2014 was a buyer's market, and not because if they sold everything at the same time in the public market they would OBVIOUSLY get less in the aggregate, but because no one in with that kind of money is buying wholesale quantity at retail prices -- it's a fire sale auction NO ONE in their right mind expects to pay anywhere close to "market" value for anything at a "must sell" auction.

Actually they always got close to face value in previous auctions of BTC. So maybe they did again this time.

My point was that above market is unlikely, close below market is very likely and even 10% away from market is pretty much impossible due to arbitrageurs.

What they reasonably expected to get and what they got could be two totally different things, every blind auction is a hail mary pass; you throw it because you want it to work not because you expect it to work and when it does connect you are as shocked as everyone else in the whole stadium.

Anyone in BTC market knows values could easily swing 15% in a week and 20% over the span of a month.  So would be unwise to make a blind wholesale bid of anything close to public market value.  If all of 2014 the market trend was down, down, down; only recently did it do an about-face and go up, up, u [stuck at $299].

So, you would NOT buy a big amount of BTC in one month at -20% if you had to pay for them today, with delivery in 1 month?

Highly unlikely that I would do that arrangement.    I'd do the 20% discount for cash and carry, however, I would not do a mere 20% discount for seized goods, It would need to be a minimum of 50% discount if I get past the ethics of the matter.

[cryptworld]

it doesn't make sense that you bid lower than the market price because getting that amount in an exchange is more difficult and untrusted

[TheGr33k]

I wouldnt by it because I would never in my life need to own 50k bitcoins

[Hfleer]

I believe that anybody that would have bid below-market or at-market rates would not have won the auction.The alternative of buying 50,000 coins on the exchanges would drive the price way up, so bidders were already willing to pay at least market rate. In fact, it is possible that the recent rise is the result of auction losers buying on exchanges.

That assumes that there are people who want to buy 50000 coins and would have to otherwise buy on exchanges.

I am pretty sure that this is a rare case.

you are being very, very kind.

I'm guessing the USMS chose the avenue they traveled expecting to get about 50% to 70% LESS than the face value of the merchandise. If they wanted face value they would have sold it on the open market little by little like anyone else seeking face value.  The also could have advertised a minimum bid of $200 so that everyone knows they want face value plus.  But none of that happened because they knew they would not get it.  Not just because all of 2014 was a buyer's market, and not because if they sold everything at the same time in the public market they would OBVIOUSLY get less in the aggregate, but because no one in with that kind of money is buying wholesale quantity at retail prices -- it's a fire sale auction NO ONE in their right mind expects to pay anywhere close to "market" value for anything at a "must sell" auction.

Actually they always got close to face value in previous auctions of BTC. So maybe they did again this time.

My point was that above market is unlikely, close below market is very likely and even 10% away from market is pretty much impossible due to arbitrageurs.

What they reasonably expected to get and what they got could be two totally different things, every blind auction is a hail mary pass; you throw it because you want it to work not because you expect it to work and when it does connect you are as shocked as everyone else in the whole stadium.

Anyone in BTC market knows values could easily swing 15% in a week and 20% over the span of a month.  So would be unwise to make a blind wholesale bid of anything close to public market value.  If all of 2014 the market trend was down, down, down; only recently did it do an about-face and go up, up, u [stuck at $299].

So, you would NOT buy a big amount of BTC in one month at -20% if you had to pay for them today, with delivery in 1 month?

Highly unlikely that I would do that arrangement.    I'd do the 20% discount for cash and carry, however, I would not do a mere 20% discount for seized goods, It would need to be a minimum of 50% discount if I get past the ethics of the matter.

That is a pretty personal reason then. Because I think most investors leave their ethics at home when trying to optimize their portfolio.

[shit coin]

I would have bid no more than $220 in case the auction crashed the price.

[Hfleer]

I wouldnt by it because I would never in my life need to own 50k bitcoins

The coins were split up in lots and you were able to bid on smaller amounts. 2k/5k if I am not mistaken.

[Armis]

it doesn't make sense that you bid lower than the market price because getting that amount in an exchange is more difficult and untrusted

Actually the best logic is in line with only buying at a lower than market price.

Private transactions rarely influence the public marketplace, and when it does its because there is a lot of merchandise, that is not the case here.  It is unwise to compare or contrast private transactions with public marketplaces transactions.  The private market is only influenced by the activity at the public marketplace to the extent that you permit it to; there is motive for the seller to pitch that argument, but no reasonable reason for the buyer to accept that rationale.

Even if it wasn't an auction you should expect to get a discount for buying in bulk (wholesale),
even if it was a bulk sale you should expect to get a discount for buying at an auction,
even if it wasn't a bulk sale auction you should expect to get a discount buying from the govt,
even if it wasn't a bulk sale auction conducted by the govt you should expect to get a discount buying seized goods,
so when you have
a bulk sale auction of seized goods conducted by a govt agency you logically should expect what?  Face value?  Come on, think.

That is a pretty personal reason then. Because I think most investors leave their ethics at home when trying to optimize their portfolio.

Nothing rare about those ethics, that's why all of the foreclosure and seized property auctions are not constantly packed and selling things at, near, or above market value.



_____________________

I wouldnt by it because I would never in my life need to own 50k bitcoins

The coins were split up in lots and you were able to bid on smaller amounts. 2k/5k if I am not mistaken.

http://www.usmarshals.gov/assets/2015/dpr-february-auction/

[Armis]

Winner Of 27K Bitcoins Purchased At USMS Auction Revealed

To date, the United States Marshal Service has allegedly held three auctions for a portion of the 144,000 bitcoins confiscated in the wake of the October 2013 Silk Road bust. These auctions are claimed by Qntra to have allegedly occurred due to the continued refusal by the USG to respond to FOIA requests for further information on the alleged winners of the Bitcoin auctions. To that end, Qntra conducted and has now concluded its own investigation into the identity of the winner of the largest sum of bitcoins in the auction held by the USMS on the 5th of March 2015. That person's identity can now be revealed as real estate advisor, property manager, investor and entrepreneur Larry Dean Silvey.

http://qntra.net/2015/03/winner-of-27k-bitcoins-purchased-at-usms-auction-revealed/