50 000 bitcoin auction... i expected bitcoin to drop hard, but it seems it didn't..
Wondering if the drop because of this news-item is still coming.
(How many bitcoins were in the last auction - was it 30 000?)
The orderbook is too deep right now on BFX to support a fast movement downward -- somebody would more or less need to go nuts with the sell off or, more likely, the floors will move down gradually.
Why we go down:
1. The price will be suppressed in this auction because nobody wants to overbid like Draper did and turn into a punch line;
2. If the coins are bought at below market, there might be a move to secure some of the gains.
Why we go up:
1. Anybody buying that many coins would see slippage if they went into the market;
2. Anybody buying that many coins likely believes in the value of Bitcoins; and
3. And anybody who believes that much and wants to avoid slippage may assume the same of other bidders so you get an auction up effect.
In the end, nobody knows. Generally, 50,000 coins that weren't available for use suddenly being available for use is intrinsically bearish -- but then again, it is less than a quarter percent of 21 million -- so not too wildly bearish.
Good one, bro.
