A year ago, a single bitcoin would cost you around $ 10,000. As of this writing, one bitcoin costs approximately $ 45,000. If you went back in 2014, you could buy a single bitcoin for about $ 400. Why do we specifically mention 2014? Because when investor Tim Draper bought a large batch of bitcoins at auction. The auction was being conducted by the US Marshals Service. Bitcoin was seized from Silk Road founder Ross Ulbricht. How did that investment come out for Mr. Draper? I would say, very beautiful … very good!
Tim Draper is the founder of Draper Fisher Jurvetson, a venture capital firm based in California. He is actually a third generation venture capitalist. His father, William Henry Draper III, better known as Bill Draper, founded the Draper & Johnson Investment Company in 1962 and was president and president of the Export-Import Bank of the United States. Bill was an early investor in Skype, which was eventually sold to eBay for $ 4.1 billion.
Some of Tim’s successes include investments from Hotmail, Baidu and Tesla. He was also a very early adopter of cryptocurrency. At one point he bought about $ 41,000 of bitcoins when his cost was just $ 6. This brought him back $ 250,000. If he still held those coins today, they would be worth a little over $ 1.8 billion.
Sadly Tim lost that entire investment in 2014 when the bitcoin exchange Mt. With a huge electronic fortune kept by thousands of investors, Gox collapsed.
Somehow Tim was not done. In fact, he jumped back into the bitcoin game.
Ross Ulbricht / Silk Road
Remember a man named Ros Ulbricht? He is the boy who was arrested by the FBI in October 2013 and was eventually convicted of being the mastermind of Silk Road, a market for dark web drugs and other illegal services. He was 29 at the time. Today he is serving life without parole in a federal prison in Arizona.
As the creator of the Silk Road, Ross took a small part of every transaction that took place on his site. Be it a drug sale, a weapon purchase or a murder-for-hire, Ross took a little piece as a middleman.
During its time operation, Silk Road reportedly processed $ 9 billion in transactions. Along the way, Ross created an impressively small collection of bitcoins, 144,000 bitcoins to be exact. At the time of his arrest (October 2013), a single bitcoin was trading for around $ 180. So Ross’s bitcoin stash was almost worth it $ 25 million.
In mid-2014, the US Marshals Service held an auction for 30,000 bitcoins that formerly belonged to Ulbricht.
Tim Draper was one of 45 people bidding on seized bitcoins during the 12-hour auction. Bitcoins were auctioned in nine blocks of 3,000 bitcoins and one block of 2,657 bitcoins.
Draper was the final winner in all ten blocks of the auction. In total he paid 29,657 bitcoins totaling $ 19 million.
It turned out … a wise decision.
Draper has high expectations for bitcoin. In September 2014, when bitcoin was around $ 400, he correctly predicted that the price would eventually be $ 10,000. He was vindicated for the first time in November 2017.
They actually have even greater expectations for bitcoin, predict:
“I think Bitcoin in 2022 or early 2023 will be $ 250,000. I think the reason for this is that bitcoin will be the currency of choice.“
So what happened to those 29,657 coins? He still owns them, obviously. And as of this writing, as we mentioned earlier, a single bitcoin costs $ 45,000. Hence the value of their seized silk road coins is:
19 is not bad for a $ 19 million investment
He better hope Ross Ulbricht never leaves prison …