Ever since the Gemini Bitcoin exchange launched their daily Bitcoin auction, there has been significant media coverage about this feature. But it looks like the majority of traders is already cooling off on the project, as the auction quantities continue to drop. The peak was reached on the third day, although we are looking at less than 800 Bitcoin changing hands yesterday.
Gemini Bitcoin Auction Running Out of Steam?
There are two interesting trends taking place where the daily Bitcoin auction on Gemini is concerned. On the one hand, the average auction quantity is showing a significant decline as of late. Things started out well with over 2,0000 and 3,000 Bitcoin being purchased respectively, but it has been going downhill pretty fast ever since.
Over the past three auctions, the Bitcoin volume has dropped from 3,098 Bitcoin to 1,050- 1,002 and 793 Bitcoin respectively. This is a rather significant downfall, although there is no clear indication as to why the drop-off would occur in the first place. Having a bad day is always possible, but this is a rather dramatic decline in the first week of being launched.
At the same time, there is a positive trend to be noted as well. The average price per Bitcoin for each auction has been increasing every day. It is always positive to see the value per single Bitcoin go up, as a price increase has been looming for quite some time now. That being said, the difference between the first-day auction and yesterday’s auction is “only” US$11.345.
While some people may argue a higher Bitcoin price makes it less appealing for investors to buy into these auctions, that may not necessarily be the case. Granted, everyone wants to buy in as cheap as possible and make a profit yesterday rather than tomorrow, but even at the US$605.015 value per Bitcoin during yesterday’s auction, that is still a very low price compared to its potential value over the next few years.
One thing to keep in mind is how the Bitcoin auction project on Gemini has been live only for a week. In fact, today will be the seventh auction to take place. A lot can happen between now and a year from now, assuming the Winklevii will still offer this feature by then. The most important part is that Bitcoin is changing hands in exchange for US Dollars.
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