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Will the Bitcoin auction ruin the bull run?


U.S. Marshals Service Announcement

Whenever there has been a debacle in the Bitcoin world, US government has stepped in and appropriate actions have been taken. More than 2,700 bitcoins were forfeited from various cases revolving around cryptocurrencies. This includes that of the notorious online black market, Silk Road, which was shut down by the FBI in 2013. Silk Road was an online channel for anonymously dealing drugs and selling other illegal goods.

In an announcement released, the USMS said that the online auction will take place on Monday, August 22 from 08:00 EDT to 14:00 EDT. Those interested in acquiring these lost asset have until 12:00 EDT on Wednesday, August 18 to register. It will consist of just one block, and a $100,000 deposit is required.

Block composition for auction

The bitcoins auctioned off this month also include the case involving Carl Force IV. In July, he pled guilty to money laundering and of stealing hundreds of thousands of dollars in the digital currency while working undercover on Silk Road under the codename ‘nob’. He was sentenced to 78 months in prison.

The block might also include bitcoins from Shaun Bridges, former Secret Service agent,  who pled guilty to stealing over $800,000 worth of bitcoins while working on the Silk Roadcase. He was sentenced to serve 71 months in prison.

This auction by the USMS is one of latest involving the digital currency, bitcoin. In November, the U.S. Marshals Service auctioned off the final auction of Silk Road assets. This included 44,431 bitcoins amounting to over $15 million.

Implications on Price

The last time an auction happened for selling recovered bitcoins, there was heavy volatility in the market and the price crashed for a good period. But after the volatility settled market bounced of a base price and surged higher. This provides good opportunity to invest and hold positions for long term.

What can happen this time?

Bitcoin has already surged past $580 mark and is trading over these levels. It has made a base around $465 and is gearing up to test the $600 level. While the price might fall steeply around August 22nd, during the time of the auction, it can prove out to be a very good investment opportunity to go past the $600 mark. It is expected that once the two year high is broken, there is a high chance that the market will continue to stay over these levels.

One thing that can be surely said is that this period has a lot of volatility in store and marking the right prices is very important for investing.

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