Assuming he does pay everything back ...
All the investors who had depoits now have btc, they want to cash out, this will drive down price.
How much of the recent rise in price has been people bringing in money to invest in Pirate? Now that he is closing up shop, they will stop bring in money, this will also drive price down.
Since the price will stop rising, many miners/speculators will try to sell quickly to get the highest rate on their bitcoins, this will also cause the price to go down.
Dropping price will cause panic sells, this will also push down the price.
The sudden announcement from Pirate causes uncertainty in the market, this causes people to more cautiously invest, this allows the price to drop precipitiously.
All indicators are for downward movement, by my reconing.
As I stated above, I suspected the immediate affect would be a drop in price. I had an order sitting at MtGox for $10.65, the price dropped to $10.60. While I just got my trade in, and it looks like I was really smart, it was mostly just luck on my part. I had no way of guessing exactly where the price would drop to, but I am happy I got my trade in. Big moves are still possible, so we will just have to see where things go from here.
