As a number of high-profile bidders, both individual and institutional, line up for the Bitcoin Auction that is about to take place tomorrow, the virtual currency finds itself on a retreat mode. Bitcoin declined to a session low of $564. 36 on BitStamp, befor paring losses to settle at $565, implying a value loss of 3.58%.
Auction Tomorrow
The U.S. Marshals Service will put nearly 30,000 of Bitcoins on auction tomorrow as the aggregate value of the auction is estimated at $17.3 million. Those 30,000 Bitcoins are part of the 144,000 confiscated virtual currency by the Federal Bureau Of Investigation (FBI) during its raid on the online drug marketplace, called, Silk Road.
According to reports, big bidders like Secondmarket Inc and Pantera Capital Management are participating in the event, while some sources also confirm the participation of hedge funds, thus, making the auction a big affair. The mounting interest in the auction process is claimed to be on account of expectations that the bid price will be below the market price. In this case, the bidders would be able to amass a large portion of the virtual currency at a reasonable discounted price, which otherwise, is a difficult deal in an open market.
Day Of Final Results
According to analysts, Friday’s auction will hold less meaning in comparison to the event on June 30, when the final results will be made public. Among a list of factors to look for on that day, the main focus would be on the price at which the Bitcoins are bought by the bidders. Analysts project that if the Bitcoins are sold at a price near $500 per Bitcoin, then the effect on the virtual currency in the open market would be minimal. However, if the selling price is way below the expectations like somewhere around $300, then that could cause a sharp overturn in the virtual currency market.
June 26, 2014 at 07:07AM
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