Venture Capitalist Buys Entire Stash Of 'Silk Road' Bitcoins At US Marshall Auction

Tyler Durden's picture

A single entity successfully scooped up the entire ~30,000 haul of Bitcoins that the US government seized from Silk Road. The successful bidder at the government's auction was V.C. Tim Draper (in partnership with Vaurum) who is infamous as the ideator of viral marketing, a marketing method for spreading a software application from customer to customer (making one wonder if the $19 million bid was more publicity stunt that investment). However, Vaurum has launched trading platforms in emerging markets, and we will be partnering with Tim to leverage the pool of ~30,000+ bitcoins as a liquidity source. The price of Bitcoin continues to rise, now at $650 - up from around $570 when the auction began.

 

 

Tim offered this in a statement:

Bitcoin frees people from trying to operate in a modern market economy with weak currencies.
With the help of Vaurum and this newly purchased bitcoin, we expect to
be able to create new services that can provide liquidity and confidence
to markets that have been hamstrung by weak currencies.

 

Of course, no one is totally secure in holding their own country’s currency. We want to enable people to hold and trade bitcoin to secure themselves against weakening currencies.”

 

Mr. Draper's background...

Timothy Cook Draper is an American venture capital investor. Tim Draper founded Draper Associates in July, 1985, which when joined by John Fisher and Steve Jurvetson became the venture capital firm Draper Fisher Jurvetson (now DFJ). The firm’s investments include Skype, Hotmail, Tesla, Baidu, Theranos, Athenahealth, Solar City, Box, and Parametric Technology among many others. Tim Draper created the DFJ Network, a global network of venture funds who work together to improve service to entrepreneurs, covering 30 cities around the world. Current firms include Draper Nexus (Tokyo), DFJ Athena (Seoul), DFJ Dragon (Shanghai, Beijing), DFJ Esprit (London), among others with domestic offices in NY, LA, Pittsburg, Austin, as well as the hub in Menlo Park, CA. Tim is the ideator of viral marketing, a marketing method for spreading a software application from customer to customer, instrumental to the successes of Hotmail and Skype among others. He is an active angel investor, who has invested in more than 1000 private companies to date.

 

He is the third in a line of venture capitalists. His father, William Henry Draper III, founded the Draper & Johnson Investment Company in 1962 and his grandfather William Henry Draper Jr. founded Draper, Gaither and Anderson in 1958. His father also was chairman and president of the Export-Import Bank of the United States.

 

Tim is the ideator of viral marketing, a marketing method for spreading a software application from customer to customer

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gh0atrider's picture

CLASSIC FONESTAR ACTION

 

Satoshi we adore you!!!

CPL's picture

Who doesn't want to be part of the worlds largest project to find out what the message says at the end of the 21 million coins.  21 million coins all part of a 21 million piece encrypted puzzle, and once together offer a message.  Message could be anything really.  Might be the meaning of life...or be a cookie recipe.

Thing is no one knows until the riddle is solved.

gh0atrider's picture

It's the DNA to the universe.  Satoshi thought of everything!

CPL's picture

Satoshi being the direct translation, well older translation, of Friend.  Might even be the 'missing tablet' with easy to read instructions in ten languages and video plus maps.

CH1's picture

WAIT...

Bitcoin isn't dead???

The price is going UP????

I thought....

TheHound73's picture

Bitcoin is a type 1 everywhere simultaneous planetary currency.  It doesn't die.

CrazyCooter's picture

He paid in gold, right? Traded some working capital for em, right?

Oh, just an electronic wire transfer.

Seems legit. Carry on.

Regards,

Cooter

TheHound73's picture

Yes, the terms and conditions of the exchange were all defined by the U.S. Marshalls office: http://www.usmarshals.gov/assets/2014/bitcoins/

Personally, I acquire most of my bitcoins in direct exchange for my labor.

Stackers's picture

They are correct in their target market. There are billions of "un-banked" people in countries too poor and/or unstable to support a banking system.

Toolshed's picture

But they can afford the hardware and software, and do have the technical expertise to conduct digital transactions?

crazytechnician's picture

If somebody is smart enough to use a cellphone they are smart enough to use bitcoin. But in your case I am not sure about that.

DirtyWilly's picture

One of these days you'll be forced to say something nice about Bitcoin without a back-handed comment Tylers, and I'll be there, mark my words, I'll be there.

Toolshed's picture

So, in what country can the citizens not afford a banking system, but can afford a cell network, or sattelite phones? You are apparently not smart enough to think past you next insult, much less the end game of bitcoin, or who invented it, or why. Winning!

crazytechnician's picture

Bitcoin opens the global economy to the UNBANKED . There are 5 billion UNBANKED people on this planet. Bitcoin provides access to the global economy & global markets WITHOUT the requirement for a banking system. I am hoping you will get it in the end.

waddlington's picture

Quite a few countries in Africa more or less fit that description.

http://qz.com/218988/how-to-manage-all-your-financial-affairs-from-a-20-...

"What’s more, in nine African countries—Cameroon, the Democratic Republic of Congo, Gabon, Kenya, Madagascar, Tanzania, Uganda, Zambia and Zimbabwe—mobile-money accounts now outnumber bank accounts."

Mobile-money accounts are cell phone based e-money wallets like m-pesa.

Toolshed's picture

Thanks for the link. That is interesting info. However, I did not see any mention of non-sanctioned digital currencies. The only detail was concerning Kenya and it appeared all transactions were in the Kenyan shilling. I can see the utility in virtual currencies. It is my contention, however, that if that utility ever begins to undercut the established financial sector's profits and/or impact the government's ability to collect taxes, the digital currency will be promptly destroyed by the status quo. Also, as anyone who has been paying attention knows, any digital system can be hacked. And the more profit there is to gain, the greater the hacking effort. The risks seem to outweigh the benefits.

bullchit's picture

Your labour? Hahahahahah, hang on, labor? HAHAHAHA....cunt,.

 

TheHound73's picture

 From every Englishman emanates a kind of gas, the deadly choke-damp of boredom.

CPL's picture

No there are those out there faithfully plugging away at the numbers...and finding things out along the way.  Otherwise, ever heard of the origins of a pot latch? 

Literally people party to collect all the pieces together to form the full 'picture' once a year.  Bitcoins are the larger more technologically advanced version of it.  21 million pieces of a puzzle, all encrypted with more data wrapped in the puzzle that bares a certain degree of importance to everyone.

So what would the truth be worth to you?  How much would a key to a door be worth for a person for the Solomonarii?

Anycase...doesn't matter that much, it was hoped people would see it for what it was, but that is inconsequential at this time.  7.2 billion people appearently can't organise the simplest thing to accomplish.  Even when it's handed over with instructions, software, support and clues. 

CrazyCooter's picture

Store of value?

Medium of exchange?

Unit of account?

Check, check, and check!

Regards,

Cooter

CPL's picture

Yup it's got the sound money wrapped up in a bow.  BUT an offered technology solution to a bad math problem doesn't matter much if the clients don't adopt it. 

An example; I'm on a contract somewhere and the client purchased Tivoli, which is AWESOME at doing network management and taking care of day to day operations.  Literally you can turn the entire platform into an AI to manage the back office and it doesn't come cheap as a product (around 34 million for a huge client).

This kind of creeped the managers out because it meant most of their job situations would have been considered superfluous to the operational aspects of their job.  So they shelved it.  34 million sitting on a shelf.

What the real situation was is the managers had no staff to begin with and were around 560 years behind scheduel in man hours applied projects.  What they didn't get is the machine would take care of the other machines and they could focus their real talents elsewhere like developing good projects to answer future and current requirements.  But people love hugging their gear.

Now in that situation, that was only electronic crap that was going to break and get replaced eventually.  The idea of doing the same thing to money.  LOL!  It takes considerable faith and will to make the leap, even while the financial situation is beyond repair.  Only other time the attitude is seen in a local experience is when a junkie is trying to kick their habit.  They will fight tooth and nail mentally to hold on to something that once gave pleasure and now only destroys them inside and out.

Exponere Mendaces's picture

@CH1

Yeah, go figure, right? I thought it was the fourth "deadening". Gosh, it just keeps on going, doesn't it :)

Anyway, looking forward to the utilization of those coins instead of them being dumped on the open market, which is what most of the internet trolls thought would happen. (Another loss for them, I guess.)

We're on track for the current expansion and I think the mega-rally peak will be somewhere near the end of July into August.

See you next Bitcoin hater thread!

CH1's picture

It's the DNA to the universe.  Satoshi thought of everything!

Well... I might not go that far.

gh0atrider's picture

It always made fonestar laugh how the stackers were so worried about CMEs and ELEs taking down Visa and Mastercard as they placed their orders with APMEX.

Me.Grimlock's picture

"squeamish ossifrage"

TheReplacement's picture

But, but, bitcoin is a protocol.  Protocols are secure and, and,...

 

rubiconsolutions's picture

I guess the entire Draper clan are a bunch of mad men. 

CPL's picture

The seven lazy sons will learn how to work again.  Even if it kills them, just like last time.

The_Peeper's picture

That sure is a lot of coins.

Sudden Debt's picture

and yet they all fit in one wallet with room to spare

gh0atrider's picture

Yes they do!  The wonders of virtualization...

Citxmech's picture

How many Quatloos for the one named Kirk?

bullchit's picture

'And what room would that be? Look around you, Grasshopper.....Are you looking for the Patsy?

 

Sudden Debt's picture

a marketing company... says it all about bitcoins...

SuperRay's picture

The only weakness is the need for the internet to be neutral...

Oh, and that the grid continues to function..

Oh, and that they can't be hacked...

Yay..

Bunga Bunga's picture

These "dangers" of electronic money have been known for a long time.

1000yrdstare's picture

TIM DRAPER IS FONESTAR!!

gh0atrider's picture

My crytptose runneth over.

_ConanTheLibertarian_'s picture

My condolences with those shitcoins.

CH1's picture

My condolences with those shitcoins.

LOL... yeah, sure... all those BTC holders are suffering mightily!

Al Capowned's picture

Yeah its really tough holding the top performing asset (by a country mile) 4 years in a row

booboo's picture

So the kings enforcers traded some free bitcoin for a shit ton FRN's?  Nice, I see where this is going.

LawsofPhysics's picture

I'll keep sharing this information until everyone is listening.  While I do see the utility of electronic currencies in facilitating global trade, it's always an issue of faith and confidence, even in the tech world.

 

I had a very dependable kid who threw hay for me years ago.  He went to college and majored in computer science, he learned several computer languages and could write code.  He went on to get an MBA and in 2001 went to work for JPM. As he put it; "they wanted to have a strong position in electronic currencies".

 

Hedge accordingly.

 

gh0atrider's picture

Well too bad for JPM, their patent got rejected a million times and they missed the boat.

So gh0atrider guesses he's back bucking hay...

LawsofPhysics's picture

They have had plenty of servers "mining" bitcoins or some crypo-equivalent for at least ten years as far as I can tell.  I don't think you understand how a ponzi works.  Please, JPM, like all PDs, has access to as much freshly printed FRNs as they like, that's the real problem.  Maybe someday the ignorant fucks (sheep) will get it, but I doubt it.  So long as they have limitless firepower, they can frontrun anyone in any "market".

Full faith and credit...

CH1's picture

I don't think you understand how a ponzi works.

I don't think you understand how Bitcoin works. You cannot just mine as many coins as you like.

LawsofPhysics's picture

No shit sherlock, but you can mine coins.  I am mining myself, it took resources to build that server.  The PDs have considerably more resources than I do asshat, that's the point (which you clearly missed).

 

gh0atrider's picture

...and then magically convince everyone on Earth to switch over from Bitcoin to your new coin?