Personally, if I was buying a lot of BTC (like, $1M + worth) I probably wouldn't make big walls on exchanges. I'd probably send like $100k to Bitstamp and set up some deal with someone like Bitpay who has to constantly churn thru tons of coins to constantly be providing me with the coins if the price goes below $X. That way the huge wall wouldn't freak people out on the exchanges.
I bet that way I could get my hand on a lot of coins for a reasonable price. Another trick would be to invest in a company involved with BTC, and who could potentially have a BTC IPO.
Topic: What would happen to price if someone would buy Bitcoins with 1 Billion dollars? (Read 1074 times)
October 24, 2013, 05:45:29 PM
October 24, 2013, 05:28:56 PM
I actually don't agree with the statement that it would not happen in the markets but in the private deals. That is simply because there is (probably) not private deals where you can buy that much Bitcoin so you have to use at least partially public channels.
October 24, 2013, 05:28:21 PM
Or someone with $1B would just invest in Bitcoin startups.
Good point, even Fortress was saying the market cap is too low for them to invest. A lot of the money that's now going to startups could start going directly into Bitcoin once the market cap is higher. Not to mention all the hedge funds waiting on the sidelines for the market cap to rise to acceptable levels for them not to be a whale in swimming pool.
October 24, 2013, 05:25:07 PM
They'd buy through Second Market or Pietila's network or some dark source to avoid slippage, then a while later we'd see steady, massive swells on the exchanges (sort of like we're seeing now, but that could just be China or SR or something else).
Yeah the amount of slippage would be insane... the price might go to $10,000/BTC but it would culminate in the biggest crash in Bitcoin history. I agree with others that said it wouldn't happen on an exchange, but in private deals. Or someone with $1B would just invest in Bitcoin startups. October 24, 2013, 05:01:33 PM
They'd buy through Second Market or Pietila's network or some dark source to avoid slippage, then a while later we'd see steady, massive swells on the exchanges (sort of like we're seeing now, but that could just be China or SR or something else).
October 24, 2013, 03:39:06 PM
My guess is that if someone tried to buy $1 billion worth of bitcoins, they would end up owning about 1,000,000 bitcoins, and the price would go up by a factor of 5 to 1000, including the subsequent fall in value. They would have to do it over a period of several months.
October 24, 2013, 03:38:52 PM
I would happily sell someone a billions dollars worth of bitcoins. Any billionaires out there, feel free to PM me.
October 24, 2013, 03:30:55 PM
They would have to find the sellers first.
You wouldn't be able to find enough coins on the markets (and the markets probably couldn't handle it anyway), so the only option you have is to announce publicly that you are buying coins at a fixed price $X.
Given that X is higher than market price, that would essentially move all market Asks to $X for as long as this order stood, since most people wouldn't sell at less than $X when they know they can get $X. If there weren't enough Bids to match then that could stall the markets.
You wouldn't be able to find enough coins on the markets (and the markets probably couldn't handle it anyway), so the only option you have is to announce publicly that you are buying coins at a fixed price $X.
Given that X is higher than market price, that would essentially move all market Asks to $X for as long as this order stood, since most people wouldn't sell at less than $X when they know they can get $X. If there weren't enough Bids to match then that could stall the markets.
October 24, 2013, 03:19:52 PM
they wouldn't be touching an exchange, so probably irrelevant to us 
October 24, 2013, 03:18:33 PM
The number of seats in higher echelons of bitcoin ownership is discussed here.
100 people will be able to hold BTC10,000 or more
1000 people will be able to hold BTC1,000 or more.
Bitcoin has served these owners so well that they are generally unwilling to sell except maybe a small part of their holding. The price rise does not necessarily induce more selling (may be the opposite).
In one year perhaps only 10-20% of the bitcoins of this club become available. We are talking about 1 million BTC.
Conclusion: I have absolutely no idea, and would like to be able to estimate but cannot, but feel that it takes very little to move the price up now (or down, if you can keep pounding it).
In March the "tear coefficient" ((change in bitcoin market cap)/(trading volume)) was 10, in a certain day. By applying this, market cap would go up 10 billion as a result of 1 billion purchase.
I think it's about right. The very rich have probably been warned from buying bitcoins. Physical silver is a no-no for them also.
100 people will be able to hold BTC10,000 or more
1000 people will be able to hold BTC1,000 or more.
Bitcoin has served these owners so well that they are generally unwilling to sell except maybe a small part of their holding. The price rise does not necessarily induce more selling (may be the opposite).
In one year perhaps only 10-20% of the bitcoins of this club become available. We are talking about 1 million BTC.
Conclusion: I have absolutely no idea, and would like to be able to estimate but cannot, but feel that it takes very little to move the price up now (or down, if you can keep pounding it).
In March the "tear coefficient" ((change in bitcoin market cap)/(trading volume)) was 10, in a certain day. By applying this, market cap would go up 10 billion as a result of 1 billion purchase.
I think it's about right. The very rich have probably been warned from buying bitcoins. Physical silver is a no-no for them also.
October 24, 2013, 01:59:33 PM
Just FYI, most bitcoins that exist are not currently available for sale on any market.
If you pumped enough money in, you could clear most of the sell orders in one shot. That would push the price up and lure more coins in, but the second round would be more expensive, etc. The result would probably be a few hundred thousand coins, and the market price would probably end up north of $1000 per BTC.
If you pumped enough money in, you could clear most of the sell orders in one shot. That would push the price up and lure more coins in, but the second round would be more expensive, etc. The result would probably be a few hundred thousand coins, and the market price would probably end up north of $1000 per BTC.
October 24, 2013, 01:44:31 PM
Not enough parameters given. Over what time period? What is the liquidity on the (bonus question, how many/which exchanges)? Etc. Generic answer would be a massive spike up followed by a massive spike down though landing higher than it was before the up spike because that's what bitcoin usually seems to do.
October 24, 2013, 01:40:40 PM
Another stupid thread.
October 24, 2013, 01:36:37 PM
It doesn't matter who is buying the bitcoin in determining the price. if oprah wants to buy a bitcoin she will pay market value, maybe a bit higher, but just because some buys a bitcoin with a billion dollars doesn't make a difference, only difference it would make is if they bought a billion dollars worth of bitcoins.
October 24, 2013, 01:31:47 PM
I mean it is just matter of time that Gates/Buffet/Soros/Icahn/Citadel/Goldman Sachs/UBS/Zuckeberg/Thiel/Bezos will truly understand how disruptive Bitcoin is.
Jump to: