A market (any market) only has so much depth.
Taking a look here:
http://mtgoxlive.com/orders
Even 100,000 BTC would drop the price to $5.68. Now that also assumes buyers won't react to falling prices (which they will so you likely couldn't sell 100K BTC and have the drop only drop to $5.68). While someone could cash out 488K BTC all at once it would be foolish. They likely would lose a million or more USD in value. If you wanted to cash out just sell 1K BTC a day for the next year or so.
I would also point out that those large accounts may not be individuals they could be for example a MtGox cold storage address.
Topic: How liquid are large stashes of bitcoins? - page 2. (Read 3346 times)
Every once in a while someone comes in wondering what would happen if everyone liquidated at once.
It doesn't matter, because to do so would mean taking out every bid that exists in the order book if the amount to sell was large enough.
There is zero incentive to bail on a large amount if you know you'll crush the price - it would make more sense to liquidate slowly if that was your intent, so price could recover and the bids you take out get replenished over time.
So, to recap - nobody has dumped on the market enough to kill the price, even though they could if they really wanted to.
The world keeps turning, and fiat keeps burning...
It doesn't matter, because to do so would mean taking out every bid that exists in the order book if the amount to sell was large enough.
There is zero incentive to bail on a large amount if you know you'll crush the price - it would make more sense to liquidate slowly if that was your intent, so price could recover and the bids you take out get replenished over time.
So, to recap - nobody has dumped on the market enough to kill the price, even though they could if they really wanted to.
The world keeps turning, and fiat keeps burning...
So I've been reading lots of this form since I joined and haven't read about anyone asking about this scenario. After reading the Forbs article about the largest bitcoin wallet (488k'ish coins valued ~2.8mil) I got to thinking. While is value isn't over 51% of all coins what if he decides tomorrow he wants to cash out? What would be the process? Just go to mt.gox and tell them to wire you the money for them? How long would it take and would it require breaking up sales over various buyers?
Thanks,
Kaji
Mt. Gox doesn't buy or sell bitcoins from anyone, it matches buyers with sellers. If the owner of 488K bitcoins wants to sell them he will need to find someone to buy them. You can look at Mt. Gox's orderbook to see how much people want to buy now.Thanks,
Kaji
If he tries to dump it all at once he will crash the price and not get a lot of USD for it. A sounder strategy would be to put up an ask at a low price and wait for people to execute it.
Problem with MtGox is their AML and KYC regulation. You can't just sell off your bitcoin, you gottach have your identity verified and mtgox gottach spy on you for da government.
So I've been reading lots of this form since I joined and haven't read about anyone asking about this scenario. After reading the Forbs article about the largest bitcoin wallet (488k'ish coins valued ~2.8mil) I got to thinking. While is value isn't over 51% of all coins what if he decides tomorrow he wants to cash out? What would be the process? Just go to mt.gox and tell them to wire you the money for them? How long would it take and would it require breaking up sales over various buyers?
Thanks,
Kaji
Thanks,
Kaji
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