Sign in or Register

Already a member?

Sign in

Or sign in with your account on:

Not a member yet?


Virtual Currency Plummets Following Fed Seizure of Black Market Website

  +Follow October 2, 2013 11:58AM
Tickers Mentioned:

The digital currency Bitcoin, which just yesterday came under intense scrutiny of banking regulators in New York, tanked in value following a massive government crackdown on an illegal marketplace that exclusively utilized the digital cryptocurrency.

The Silk Road, an online market where users could buy drugs, guns, and falsified identification documents using the anonymous Bitcoins, was shut down by the FBI and ICE on Oct 1, and its operator was arrested on federal narcotics charges.  

Ross William Ulbricht, known by his nom de plume “Dread Pirate Roberts,” had been running the illegal site since 2011, and had long avoided authorities by staying cloaked in the “Deep Web,” or anonymous underbelly of the internet, via safeguards and secret servers. While arresting Ulbricht and shutting down Silk Road, the government also seized 26,000 bitcoins from Ulbricht’s virtual wallet. This amounts to .002 percent of the total amount of bitcoins in circulation.

The total bitcoin market is worth approximately $16.4 billion.

Of more pressing issue than Ulbricht's bitcoin stash to the viability of bitcoins as a functioning currency was the amout of trade the Silk Road website provided. Authorities estimate that $1.2 billion in bitcoins traded hands on the site in the last two years.

While the digital currency has its roots in the internet black market, some on the fringes of Wall Street have begun to take it seriously, and made attempts to legitimize it. The Winklevoss twins of Facebook Inc. (FB) fame have referred to Bitcoins as “the internet of money,” and “gold 2.0” and have filed with the SEC to start a Bitcoin ETF.

But as the Ulbricht case has shown, the non-fiat currency is still extremely volatile. The currency swung wildly on Wednesday, losing a third of its value as users sold off bitcoins in a panic.

In August the Department of Homeland Security seized $5 million from bitcoin vault Mt. Gox, alleging the site was operating as a money transmitting company illegally without the regulations placed on companies like Western Union (WU)

Despite critics deriding the currency as reflecting a "sub-kindergarten-level monetary understanding" as Forbes contributor Nathan Lewis asserted, Bitcoin remains popular, and continues to entice investors.

Following the panic following Ulbricht’s arrest, the currency stabilized, regaining three-quarters of the value lost in the morning panic.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.

Liked What You Read? Join Equities.com and Connect With Your Favorite Financial Experts FOR FREE! Members of Equities.com gain access to our leading financial news and content, active social investment community, proprietary research tools including the 2014 Small-Cap Stars, E.V.A. reports and more.

Results for FB
Carolyn B Miciano
18 Dec 14 04:13:31
How the financial world works http://t.co/BMKhHokrwQ $AMZN $FB $TWTR
Beating the Market
18 Dec 14 04:13:05
New post: Nothing wrong with $FB http://t.co/HCBjjXk4TD
Arjun Kharpal
18 Dec 14 04:12:39
Facebook's next foray into commerce...allowing users to sell goods through posts: http://t.co/hkxOSBCIqw $FB http://t.co/hOepgCOiaX
18 Dec 14 04:12:08
You could soon sell goods through a Facebook post: http://t.co/wEZA38BSqm $FB http://t.co/IZDP2NzHsq
The Stock Professor
18 Dec 14 04:09:42
$FB $TWTR $AAPL $IBM ARM outperforms as Britain's FTSE extends gains on Fed boost http://t.co/UkzmFs4qCV
James DiPlata
18 Dec 14 04:05:48
RT @LargeVoidBot: Popular: $KNDI, $FB, $INO, $VXX, $TKMR, $IBB, $COP, $QCOM, $XLU, $GS, $RDNT, $LOGI, $BABA
18 Dec 14 04:03:04
$FB $TWTR: Facebook (FB) Introduces Auto-Enhance For Pictures Uploaded ... http://t.co/NWc727aCwg http://t.co/DcmxCpWq70
Vaulty Boy
18 Dec 14 04:00:12
you guys can still save %50 on yearly! Code: PROFITMAS http://t.co/fkwdWxqJqP $UVXY $SPY $NVGN $ODP $TWTR $FB $BBRY
Large Void Bot
18 Dec 14 04:00:09
Popular: $KNDI, $FB, $INO, $VXX, $TKMR, $IBB, $COP, $QCOM, $XLU, $GS, $RDNT, $LOGI, $BABA
18 Dec 14 03:59:51
#TOPTICKERTWEETS $SPY $AAPL $USD $DAX $RUSL $SPX $IGN $AMZN $FB $BBRY #quantheta #sentiquant 20141218 07:00:21:913
18 Dec 14 03:59:50
#SENTISHIFTUP $SPX $LNKD $BBRY $FB $AAPL $QUAD $SPY $AMZN $GOOG $USO #quantheta #sentiquant 20141218 07:00:09:970
Clayton Gilman
18 Dec 14 03:49:43
RT @JasonBondPicks: FREE chat Thursday and HAPPY HOUR http://t.co/eiSidUKWlj $ALU $ICL $RUSL $NOK $OPK $HL $FB $AAPL $GOOG $ZNGA $SIRI $ONV…
18 Dec 14 03:46:23
Top 4 Signs the Stock is a Scam http://t.co/mHcAAR3Zoo #stocks #trading $FB $GPRO $LNKD http://t.co/AeqFZVzdjd
Dan O'Connell
18 Dec 14 03:43:25
Bought back covered calls yest am in $GILD, $URI, $FB & $BA. Now its time to ride the shares then roll them options !
Jason Bond
18 Dec 14 03:37:33
FREE chat Thursday and HAPPY HOUR http://t.co/eiSidUKWlj $ALU $ICL $RUSL $NOK $OPK $HL $FB $AAPL $GOOG $ZNGA $SIRI $ONVO $PLUG $NVGN $S
PennyStock Zone
18 Dec 14 03:34:21
*Review* How to Make Money in Stocks: http://t.co/WWoN6E7nPc $FB $TWTR $STUDY $LIVE $APT #stocks #trading
18 Dec 14 03:25:26
$FB high open interest range is 70.00 to 77.50 for option expiration 12/20/2014. http://t.co/IROhe7DoA3
Sam Simon News
18 Dec 14 03:24:38
#blackfish Facebook hits 357,000 fans, SeaWorld Needs More Than a New CEO http://t.co/OZnFV9fFPz via @daily_finance $SEAS $FB
18 Dec 14 03:07:26
$FB Max Pain = 74.50. Maturity = 12/20/2014. Previous close = 76.11. http://t.co/Pe497PWmmv
18 Dec 14 03:04:28
http://t.co/Hce0Z2DnDs <- TriForceTraders amazing trading journey ($0.5 Million in trading profits in 9 months) $FB $LNKD #belowdeck
BUZZ Just-In
18 Dec 14 03:01:27
Access curated tweets- high relevancy, less spam- Social Media Stocks http://t.co/lHJArhR8df $FB $LNKD $TWTR $GRPN $ZNGA
Marian Z.
18 Dec 14 02:56:04
Watchlist 12/18/2014: http://t.co/Dp0LNxyPPu $ADXS $SRNE $WRES $OREX $INFN $FB $TWTR $SPY $AAPL
Chung Pham
18 Dec 14 02:44:36
$FB testing...
Arcadio Lepard
18 Dec 14 02:43:44
Expect extremely strong earnings from $FB when they report on October 28th, Buy on weakness $TWTR $SOCL $QQQ
PennyStock Zone
18 Dec 14 02:32:37
Legally benefiting from insider trading! My strategy revealed! http://t.co/78qVt6cUcI $NVEE $MZOR $FB $TWTR $STUDY $EYES
18 Dec 14 02:22:37
DollarsOnPennies: $FB Weekly http://t.co/6FQpcLMMef
18 Dec 14 02:22:36
DollarsOnPennies: $FB Daily http://t.co/jcETf9EiUY
18 Dec 14 02:21:24
http://t.co/zwEo5IsZ7y <-- Don't blindly copy Tim Sykes or SuperTrades! $OIL $VMW $USD $TWM $ANIP $DRI $SCO #stocks $FB
Russell Barbour
18 Dec 14 02:18:35
http://t.co/hsQSac1T47 <-- Don't blindly copy Tim Sykes or SuperTrades! $OIL $VMW $USD $TWM $ANIP $DRI $SCO #stocks $FB
PennyStock Zone
18 Dec 14 02:16:32
Tandem Trader: http://t.co/Xk9M7IQZ3e review video #stocks #trading #nyse $FB $TWTR $EYES $RIBT
Steven Farst
18 Dec 14 02:16:18
You know what $TWTR has that $FB does not LIVE FEEDS
18 Dec 14 02:14:22
Tim Ferris 4-Hour work Week: http://t.co/PlSNsrSZAS #stocks #trading #nyse $FB $TWTR #4hrww
PennyStock Zone
18 Dec 14 02:10:28
http://t.co/xKYlpZZMUz <-- Details profitly subscribers who are making HUGE money online stock trading! $HURC $NVEE $EYES $FB $TWTR
18 Dec 14 01:59:50
#TOPTICKERTWEETS $USD $DAX $AAPL $RUSL $SPY $IGN $FB $GOLD $BBRY $WAG #quantheta #sentiquant 20141218 05:00:20:365
18 Dec 14 01:59:49
#SENTISHIFTUP $FB $BBRY $QUAD $GOLD $DAX $RUSL $AAPL $SPY $TWTR $BABA #quantheta #sentiquant 20141218 05:00:08:570
Gundis Blindmann
18 Dec 14 01:57:09
SJMggzE3Mu $BABA $TWTR $LNKD $FB $AAPL $NFLX INVESTORS #NASDAQ Ask for 2 weeks trial for #Autotrading
Russell Barbour
18 Dec 14 01:56:36
http://t.co/Zmv3NrOg79 <-- These trading books changed my financial life forever! $MOMO $CALA $CLDN $CEMP $DATE $FB $TWTR
Sleek Money
18 Dec 14 01:48:13
Short Interest in Facebook Decreases By 3.8% $FB http://t.co/KafrDJvXKS
PennyStock Zone
18 Dec 14 01:35:32
*Review* How to Make Money in Stocks: http://t.co/WWoN6E7nPc $FB $TWTR $STUDY $LIVE $APT #stocks #trading
Bullimalinna Sot
18 Dec 14 01:24:48
all my technology stock are up $FB, $AAPL, and $BABA long-term. now I'm figure away to do well on my shorts, I'm in the red with them.
18 Dec 14 01:13:12
Platinum Memberships Rose, After 528% Gains On Penny Stocks, In One Month! Big Update: http://t.co/2W3yKD2d5Q $FB $MDLZ $CELG
18 Dec 14 01:10:41
http://t.co/1mavqbCDfn <-- Details profitly subscribers who are making HUGE money online stock trading! $HURC $NVEE $EYES $FB $TWTR
18 Dec 14 01:09:44
#Facebook has reached out to #YouTube's biggest stars to urge them to distribute their videos on Facebook. http://t.co/LxB6NYoEzx $FB $GO
Antonio Costa
18 Dec 14 01:09:38
$MSFT $FB Microsoft rumored to make head-worn gaming device in 2015 http://t.co/AUcFJjYMWL
Social Tools
18 Dec 14 01:09:36
#Facebook has reached out to #YouTube's biggest stars to urge them to distribute their videos on Facebook. http://t.co/vjc2i3wRMR $FB $GO
Chung Pham
18 Dec 14 01:05:33
$APPL test cashtag $FB
The Stock Professor
18 Dec 14 01:02:10
$FB $TWTR $AAPL $IBM QSC soars after report United Internet interested in its network http://t.co/PGVsUFnBa3
tradimo deutsch
18 Dec 14 01:00:15
#Scalping – Erziele schnell und beständig Tradinggewinne: http://t.co/wy4oiezEtv #learntotrade #Forex $FB $EURUSD #Trading
PennyStock Zone
18 Dec 14 00:46:05
http://t.co/1lIQ2HI6Ev <-- This Millionaire Creates Millionaire Traders free informational video $FB $CAMT $HURC $LIVE $FCEL
18 Dec 14 00:44:53
RT @grm_chikn: SeaWorld Needs More Than a New CEO http://t.co/NtRqqRHUhS via @daily_finance $SEAS $FB
  +Follow October 2, 2013 11:58AM



blog comments powered by Disqus

About us

Equities.com is the most advanced interactive online social ecosystem for the financial industry, serving as a resource center and next-generation communication platform that connects self-directed investors with public issuers, market experts, and professional service providers and vendors. Registered members can leverage our exclusive proprietary research tools such as the Small-Cap Stars, which outperformed 90% of all small-cap mutual funds, and robust do-it-yourself E.V.A. research reports. The Equities.com Issuer Dashboard is the ideal tool to communicate and manage investor awareness campaigns to the investment community, as well as to access valuable resources to help your company grow.

Market Data powered by QuoteMedia.
Copyright © QuoteMedia. Data delayed 15 minutes unless otherwise indicated. Terms of Use.