After much hesitation over the US Marshall auction, as reflected in the price stagnation in bitcoin, weariness has subsided and bitcoin once again makes gains of roughly 10% to $654.00.
It frankly shouldn’t come as a surprise, as it made no practical sense for any bidder to immediately dump their holdings post-auction. During the time frame that the auction process took place, bitcoin’s price stagnated at around the $600.00 price range, with little to no volatility.
Once the auction took place, investors immediately jumped back into bitcoin as no problems seemed to have come up, and volatility came back once again. Volatility is by no means a bad trait, quite the contrary really. Without volatility, bitcoin can never grow substantially in terms of market cap, and adoption would therefore remain limited. As the price of bitcoin rises though, smaller units become more useful for those interested in actual everyday use.
Those that feared the USMA auction gave others an opportunity to get in while the waters were calm. We even predicted that nothing problematic would come about from this auction, in an article titled: Why Investors Shouldn’t Fear the USMA auction.
As fears over this auction subside, it also seems that bears are running out of bearish indicators entirely. The bitcoin community has gone through the trouble some countries gave it in regards to sanctions on bitcoin related businesses, and the fear over a51% attack have also gone away as GHash.IO has been recently taking a smaller role in the overall hash rate that was being produced.
It seems that if anything, bullish indicators are now emerging left and right. Newegg has recently announced the adoption of bitcoin and the bidders for the USMA auction seem to desire a buy and hold strategy, not a quick trade in any way. As more businesses choose to adopt bitcoin, further price increases are expected as bitcoin’s global reach expands.
Global education surrounding cryptocurrencies like bitcoin in general have been gradually improving as well, as the general media has lately been more inclined to put out positive and informative articles for bitcoin. As the general public slowly becomes cognizant of bitcoin, more businesses will likely follow in the adoption spree, and general fear should ebb away. As far as investments in bitcoin go, the technology is still in the investment phase, not the widespread consumer-use phase. As this shift gradually occurs, bitcoin’s price should follow in an upward trend.
*UPDATE: Tim Draper was the individual who purchased the auctioned bitcoins.
Bitcoin Rises As Fears Over USMA Auction Subside