Tim Draper Wins Seized Bitcoin Auction, Now What?
Tim Draper took home 30,000 bitcoin in a federally-sponsored auction of seized bitcoins this past summer. Draper a venture capitalist, bought a full lot of 29,656 bitcoins from the government a few months back in an anonymous auction by the U.S. Marshall service. The auction received 63 offers from 45 registered bidders and the entire lot was awarded to highest bidder, Tim Draper. He did not reveal how much he paid but the lot at the time was worth close to $20 million dollars. Draper said he plans to use the currency to develop ways to provide liquidity to the currency market through a trading platform Vaurum.
“Bitcoin frees people from trying to operate in a modern market economy with weak currencies,” Draper said.
“With the help of Vaurum and this newly purchased bitcoin, we expect to be able to create new services that can provide liquidity and confidence to markets that have been hamstrung by weak currencies.”
Draper is a founding partner of Draper Fisher Jurvetson and has been part of a number of startups including Skype and hotmail. The bitcoins won in this auction were seized from the Internet-based Silk Road when the Federal Bureau of Investigation closed down the illegal operation in October 2013. The Marshall Service auctioned off only about 20% of the total bitcoin seized during the raid.
Draper is currently invested in bitcoin trading platform Vaurum, which was a factor in his interest in the auction. The California-based startup received $4 million in venture funding, which also included investment from AOL’s CEO Steve Case.
Online sources estimate Tim Draper’s net worth to be around $1 Billion dollars and assuming his total stake in bitcoins is roughly $20 million give or take a few million his total allocation to Bitcoin represents about %2 of his entire net worth. This move by a prominent tech venture capitalist gives you an insight into how much a big time business mogul’s bitcoin allocation is set at within his overall portfolio. More than likely you and I don’t have the same amount of capital to invest with. However, knowing this information allows us to get an idea in terms of percentage portfolio allocation, how much money to comfortably hold in crypto-currency for your investments.