The United States government auctioned off 29,656 Bitcoins. After reviewing their tactics for their auction, the US government may have found a way to put money in their own pocket through an anonymous auction in a global marketplace.
Would you expect anything else from the American government?
Bitcoin and Silkroad have two things in common: anonymity and initial lack of government involvement. Not sure what those terms mean? Let me break it down for you.
An anonymous computer programmer, or group of programmers, at the height of the financial crisis in 2009, created Bitcoin. The online currency attracted the attention of the anti-establishment following that liked the idea of avoiding the banking system and government regulation. Now it is being used by local business around the world.
Silkroad was a popular black market website. Users could anonymously purchase drugs like marijuana, cocaine, ecstasy and other illegal goods and services. It made the streets safer because it reduced the risk of people getting jumped in a dark alley.
Basically, Bitcoin and Silkroad are digital tools that have changed the market place. Technology is advancing quickly and there’s no stopping it. The FBI can’t take everything down; instead they can use anonymity as an advantage to influence the value of a single Bitcoin.
In October 2013, they acquired 144,000 Bitcoins when they took down the popular black market website, Silk Road. Since it’s federal government’s responsibility for selling property taken from criminals, they have decided to auction off roughly $16.7 million worth of Bitcoins. Normally, they sell off assets such as cars, fine jewelry and yachts. This is new territory for them. This is new territory for them.
New York City hotels and retail stores are slowly accepting bitcoins. There are people and places that they can seek help from when it comes to handling such a large quantity of the digital currency. You would think that in 7 months, a plan would be created to keep them off the radar. However, the US Marshalls, FBI and Manhattan federal prosecutors like to play on their own terms. Anonymity is the end game.
Would you expect anything less from them?
Their office initially got the auction off to a good start by keeping information vague. Questions about the auction from would-be bidders were answered only in writing by a general email inbox. Bidders became aware that they were dealing with the U.S. Marshalls when they had to confirm identities and front $200,000 by Monday. They claimed that they would keep the information secret. A list of potential bidders was accidentally released on June 18 in an email from the agency.
Now that the auction is official over, are they there any winners?
There is one winner however the name hasn’t been revealed. Alex Hern from the Guardian reported that people and companies are starting to come out, revealing their identities to say that their bid was rejected or that they didn’t win. Since the auction was completed, the Bitcoin price went up from $523 to $640. Only time will tell if this is a red herring or not. Isabella Kaminska made a suspicious accusation that the government may have just laundered the money for themselves.
Whether you think that someone won the bid or the government made profit for themselves one thing is clear: this auction legitimizes bitcoin. Hotels in Brooklyn, NY and Newegg have adapted the digital currency as well. Bitcoin is here to stay.