This Week in Bitcoin

Second Tranche of Bitcoins Auctioned Off By US Marshalls


The US Marshals who were handed the responsibility of auctioning off the bitcoins seized from the last year’s crack down on Silk Road, the infamous bitcoin underground market place. The second tranche was auctioned off on 4th of December 2014, consisting of 50,000 bitcoins.

According to Reuters, the coins are being auctioned off with the permission of Ulbricht and his attorney. In the case of Ulbricht’s innocence the remaining bitcoin and the cash value of the sold bitcoin will be returned to him.

The current batch had an estimated value of $18.6 million with the total of 50,000 bitcoins sold. The previous batch on the other hand, consisted of 30,000 bitcoin worth around $17 million at the time of the auction. The difference in the value and the amount of coins is due to the decline witnessed in the bitcoin price index, throughout the year 2014.

It was noted that the second auction had a significantly lower number of bidders as compared to the previous auction, the amount of bids coming down from 45 to 11. The reason behind the lack of interest is subject to speculation. A few theories blamed the shorter bidding period to be the cause. However, CryptoCoinNews’ Caleb Chen claims that investors have learned from the previous auction that the coins are auctioned off for more than their open market value and therefore, doesn’t offer any real opportunity for a quick profit.

State of California Second in Line to Regulate Bitcoins


The state of California is considered as one of the friendliest bitcoin zones in the US, if not the world. The number of merchants adopting the currency as a medium of payment has witnessed a rapid growth, with roughly four hundred businesses accepting the digital currency for their good and services.

Due to the growing popularity of bitcoins in the state, government authorities have started mobilizing to stay up to date with the current trends. California’s Department of Business Oversight have assessed the situation and confirmed their authority to regulate the emerging virtual currency.

According to Tom Dresslar, a representative of the department confirmed the department’s decision on the virtual currency. The statement addressed the department’s prime concern, which would be the consumers and their safety – their objective, ensuring effective and reasonable safeguards against the risks associated with the currency.

The department’s positive stance of the digital currency was welcomed by the bitcoin community. Since California’s Silicon Valley possesses billions of dollars’ worth of vested interests in the digital currency. These investments could potentially help infuse the much needed funds to repair the current dismal condition of the state’s economy.

Moreover, California is not alone in their initiative to bank in on the growing popularity of the virtual currency, with Colorado also considering the legalization of the digital currency. Colorado has been reaping incredible tax benefits from the recent legalization of marijuana for recreational usage. However, due to federal laws, banks have refused to work with the marijuana dispensaries. Since these businesses are forced to deal in only cash, Colorado is experiencing trouble tracking and taxing the businesses. Hence, the legalization and regulation of bitcoin would serve to benefit not only the businesses but also the state in terms of accurate taxation.

The Tremendous $80 Million Transaction via Bitcoin


On 2nd December, a Bitcoin transaction took place, which completely rocked the entire cryptosphere. The transaction of 217,517 BTC, worth around $80 million gained significant traction due to the transaction fee of only 0.0001 BTC, worth 4 cents.

Many theories arose across various different social media platforms, the most notable being – one of the bitcoin exchange giant transferring its funds around – most probably to a more secure location. Even though the shuffling of funds didn’t exactly represent a transfer of money between two parties, it still however, signified the potential of transferring such a large amount of capital with bitcoin. Any amount can be transferred at any part of the world, across various different boundaries, at any time from any place, within a timeframe of 20 minutes, at a meager cost of 4 cents and that too without the involvement of any third parties.

No single institution aside the Federal Reserve would be capable of transferring such a large amount at such a meager rate. This is where the bitcoin technology has proved its might, providing the option to transact millions of dollars in a single transaction that too at a negligible fee for whoso ever chooses to utilize the Bitcoin platform.

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