Prices of bitcoin are plunging today on word that anonymous black market website Silk Road has been seized by US authorities. Has it created a buying opportunity, or is this just the start of website crackdowns?
Prices of Bitcoin are plunging today on word that anonymous black market website Silk Road has been seized by US authorities (you can check out the complete story here). As a source for illegal drugs, weapons, etc, Silk Road had become the Amazon of the black market, as it operated on the dark net, as well as used bitcoins as its payment source. As a result, it became one of the prime creators of demand for purchasing bitcoins.
Reacting to the news, prices of bitcoin on Bitstamp have fallen to a low of $85 today after trading as high as $127. Similar price declines have taken place at other leading exchanges, MtGox and BTC-e.
The question now is whether the current fall is a buying opportunity or the beginning of a drop in bitcoin prices on lower demand. Much of that answer will depend on how much demand Silk Road and similar sites really provided. In terms of estimates, in a Bitcoin Meetup held in Israel this summer, Meni Rosenfeld, Founder of Bitcoil, calculated that global monthly commerce in bitcoins was $200 million. Of that, he estimated that less than 50% was driven from gaming and black market activity. Using those figures, and the abundance of gaming related sites, it can be assumed that Silk Road, as well as similar sites attribute to less than 10% of total bitcoin commerce.
Based on those calculations it would indicate that today’s sell-off is a bit irrational. On the other hand, the Silk Road seizure reveals that US authorities are willing to take an aggressive stance against illegal, anonymous bitcoin related sites. As such, we could easily see authorities target some of the larger gaming sites for servicing US customers. In that regard, despite real demand, prices will probably be vulnerable to additional headline risk over the near term. Specifically, seizure of any large gaming sites could probably trigger an equal if not larger sell- off.
Buy, Sell or Hold? Let us know in the comments what you think.
(Personal opinion – I am a buyer)
Prices of Bitcoin are plunging today on word that anonymous black market website Silk Road has been seized by US authorities (you can check out the complete story here). As a source for illegal drugs, weapons, etc, Silk Road had become the Amazon of the black market, as it operated on the dark net, as well as used bitcoins as its payment source. As a result, it became one of the prime creators of demand for purchasing bitcoins.
Reacting to the news, prices of bitcoin on Bitstamp have fallen to a low of $85 today after trading as high as $127. Similar price declines have taken place at other leading exchanges, MtGox and BTC-e.
The question now is whether the current fall is a buying opportunity or the beginning of a drop in bitcoin prices on lower demand. Much of that answer will depend on how much demand Silk Road and similar sites really provided. In terms of estimates, in a Bitcoin Meetup held in Israel this summer, Meni Rosenfeld, Founder of Bitcoil, calculated that global monthly commerce in bitcoins was $200 million. Of that, he estimated that less than 50% was driven from gaming and black market activity. Using those figures, and the abundance of gaming related sites, it can be assumed that Silk Road, as well as similar sites attribute to less than 10% of total bitcoin commerce.
Based on those calculations it would indicate that today’s sell-off is a bit irrational. On the other hand, the Silk Road seizure reveals that US authorities are willing to take an aggressive stance against illegal, anonymous bitcoin related sites. As such, we could easily see authorities target some of the larger gaming sites for servicing US customers. In that regard, despite real demand, prices will probably be vulnerable to additional headline risk over the near term. Specifically, seizure of any large gaming sites could probably trigger an equal if not larger sell- off.
Buy, Sell or Hold? Let us know in the comments what you think.
Webull Introduces "Lite" Version of Trading App for Retail Users
Network, Learn, Grow | FMAS:24
Network, Learn, Grow | FMAS:24
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
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Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
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Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
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Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
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Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
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Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
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#fmas #fmas24 #fmevents #networking #finance #africa
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Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
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Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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