The Winklevoss Twins Are Now Bitcoin Billionaires (theverge.com)

The twin brothers who gained notoriety for suing Mark Zuckerberg over the claim that they started Facebook have done remarkably well in the wake of Bitcoin's record gains. From a report: Cameron and Tyler Winklevoss won $65 million from the Facebook lawsuit, and invested $11 million of their payout into Bitcoin in 2013, amassing one of the largest portfolios of Bitcoin in the world -- 1 percent of the entire currency's dollar value equivalent, said the twins at the time. Their slice of the Bitcoin pie is now worth over $1 billion after Bitcoin surged past $10,000 last week to now trade at $11,100, according to CoinDesk. The cryptocurrency has surged over 10,000 percent since the Winklevoss' investment, when one coin traded at around $120.

Comments

LOL

[Anonymous Coward]

Try selling that off. I guarantee they won't get anywhere close to $1 billion, as the price drops while selling.

Re:LOL

[goombah99]

right. only billionaires if they sell but can't sell

Re:LOL

[ArchieBunker]

What are you talking about? You can use tons of exchanges to cash in our out. Sure you take a percentage based transfer hit but come on. Hell buy gift cards from Amazon and resell them yourself.

Re:LOL

[Megol]

That the value of bitcoins will reduce drastically if they try to cash out. And I'll add that the exchanges doesn't have to $$$ to give.

Re:LOL

[religionofpeas]

For these kinds of amounts, it's probably better to do a direct trade with an investment fund or other rich person who wants to get in.

Re:LOL

[SirMasterboy]

Bitcoin does over 6 billion a day in trade volume though. Would 1 billion really affect it that much? How about just do 100 million a day over 10 days? Or do it over a month.

Re: LOL

[Anonymous Coward]

If you see someone dropping that large of an amount people would notice. Chain reaction time.

Re:LOL

[RhettLivingston]

There are many small-cap stocks out there whose price will be impacted if you sell $100K all at once. If you sold $1 billion in Apple stock in a single day, a large portion of its current average daily volume, you'd impact the price pretty dramatically. As with any asset that is only worth as much as the next buyer will pay, a mega-investor would have to sell Bitcoin at a pace compatible with the daily trade volume.

Given that the daily volume of bitcoin trade is topping $1 billion right now, you could probably sell the entire stake in a couple of weeks without severely impacting the price.

Even if they decided to be stupid and cause a crash, they'd walk away with vastly more than the $11 million they invested. I'd love that because it would create an awesome buying opportunity.

Re:LOL

[leonbev]

Yeah... if someone got word that they were selling their stash, the value would probably get cut in half within 6 hours.

Just the kind of thing you want from something that's supposed to be a currency... wild price swings :)

Re: LOL

[Anonymous Coward]

They could cause a blip on purpose. The SEC really wont be regulating bitcoin right now.

Re:LOL

[Streetlight]

If you owned one billion dollars in Apple stock and sold all of it all at once, provided there were instant buyers, you might get your one billion. If the stock tanked, it might not hurt you, just everyone else that owned Apple stock. The key is finding buyers all at once.

Re:LOL

[Anonymous Coward]

Simple. Unless there are no investment funds or rich people who want in at that price.

Re:LOL

[RhettLivingston]

Yeh, good luck on that. You'd have to find a moment where there are sell orders for nearly six million shares without buy orders to match. You might find such a moment during a price plunge, but that wouldn't be a smart time to take advantage of it. Looking at the recent charts, I do see some end of day moments when 6 million shares traded, but those moments had buyers in the market for those shares. If you dumped your six million at that moment, you'd have 12 million shares for sale and be short on buyers. Simply put, you can't trade a fifth of Apple's daily volume all at once unless perhaps you found someone who would just purchase your stock direct.

Re:LOL

[Anonymous Coward]

Same thing with the stock price of shares and such. If they sold it slowly and carefully they could probably get it. Or hold on until it's worth 10 billion.

Re:LOL

[Anonymous Coward]

Based on volume on multiple exchanges, you could easily sell off $1 billion without affecting the price very much.

There are much larger whales in the BTC market. Much, much, larger. Those are the guys that drive (ie. manipulate) the market. We're talking nations here... *cough* China...

Re: LOL

[Anonymous Coward]

Doesn't that make the case that this is more a security than a currency? If I have $1 billion in cash I can use it at will and not lose money just because I do.

Re:LOL

[Zaelath]

Bitcoin does over 6 billion a day in trade volume

Says who? And how much of that volume is trading bitcoin for bitcoin?

When the trend is up, most of the orders are buy, you can bet your ass $100MM USD a day in sell orders would be noticed.

Re:LOL

[Anonymous Coward]

Waaa Waaa, I have no BTC and I must scream.

Re: LOL

[UrbanMonk]

And when they do cash out the IRS will be there waiting.

Re:LOL

[Gussington]

That the value of bitcoins will reduce drastically if they try to cash out.

I just checked Bittrex and $50k of BTC was sold in the last 60 seconds, and that is pretty normal all day every day.

And I'll add that the exchanges doesn't have to $$$ to give

Neither do banks or the share market, or the gold exchange for that matter. Money doesn't really get moved as cash in suitcases anymore. As long as it can be used as a security (which it can) it's as good as cash.

Re:LOL

[Gussington]

Bitcoin does over 6 billion a day in trade volume

Says who?

Really? Market trades are public information https://coinmarketcap.com/

And how much of that volume is trading bitcoin for bitcoin?

What? That makes no sense. Why would I trade Bitcoin for Bitcoin? Trading means exchanging something for something else

When the trend is up, most of the orders are buy, you can bet your ass $100MM USD a day in sell orders would be noticed.

$100M in one trade might, but no-one is that stupid. A fund I'm associated with dumps millions a week across multiple exchanges and it's not even a blip. But why cash out? Bitcoin is a currency and a security, they can buy things directly with it use to borrow against. Just like Shares, Gold or Cash.

Re:LOL

[Zaelath]

I can show you 3 other sites that appear to give different figures, why is that one trustworthy?

Apparently the Chinese used to love trading bitcoin for bitcoin: https://www.coindesk.com/real-... but regardless, moving 'value' from one person to another is trading bitcoin for bitcoin.

Who the fuck is taking bitcoin as a security? That might just be the dumbest thing I've heard this year.

Re:LOL

[KingBenny]

Well, i guess they won't win the Nobel prize for economics then (L A W L ollll) ... i still don't understand how anyone who gets a nobel prize could say something unfounded like that ("BTC should be outlawed") since throughout history i think about 99.99% of all crime still went in dollar or gold lol lol ol ol ol
the wolvestreet walls here saw it, took the risk and did it, i betcha fiver among the in-crowd upthere there's a lot of green faces now, sure to tell you how it all will burst soon ...
and it might ... but even if it does, seeing as they "only" invested $11kk at the start when it was a gamble , they wont really lose much :) ... i think thats why they call it "venture" or something ... :p
the art of calculating risks ... and when it comes to selling these people surely know how to flow instead of dump, HOWEVER
that amount of coins gives them actual leverage TO make it plummet, combined with some media hype up front into a chain reaction, i think thats what makes this interesting, why would those fuckers care about a billion more or less lol i think congrats are in order though ... being down with shin sekai ... it doesnt seem to be the forté of the lobbyright activists

Re:LOL

[Gussington]

I can show you 3 other sites that appear to give different figures, why is that one trustworthy?

Yet you didn't post them. I find that odd...

Apparently the Chinese used to love trading bitcoin for bitcoin

Ok so you've demonstrated that you have no idea how an exchange works. Probably best to stop right there.

Who the fuck is taking bitcoin as a security? That might just be the dumbest thing I've heard this year.

The funny thing about reality is that it doesn't care what you think. And this sums up nicely the anti-bitcoin rabble. I have no idea how it works, therefore it must be crap.

Re:LOL

[Zaelath]

Apparently the Chinese used to love trading bitcoin for bitcoin

Ok so you've demonstrated that you have no idea how an exchange works. Probably best to stop right there.

There was lots of volume on the Chinese exchanges when there was zero fees
https://www.coindesk.com/real-...

If I trade BTC => Other => BTC, it's still just trading BTC for BTC to inflate the volume.

As to others, here's one: https://data.bitcoinity.org/ma...

That's only showing about $3.5B for the last 24 hours, still a lot but not "over $6" and it includes exchanges w/o fees, which are prone to be manipulated.

Re:LOL

[Gussington]

If I trade BTC => Other => BTC, it's still just trading BTC for BTC to inflate the volume.

Ok so you've demonstrated that you have no idea how an exchange works. Probably best to stop right there.

That's only showing about $3.5B for the last 24 hours, still a lot but not "over $6" and it includes exchanges w/o fees, which are prone to be manipulated.

Ok so you've demonstrated that you have no idea how an exchange works. Probably best to stop right there.

Re:LOL

[Zaelath]

OK so you've demonstrated you have no argument, I'll stop right there.

wait for it to drop when someone trys to unload th

[Joe_Dragon]

wait for it to drop when someone trys to unload that much. Just like the stock market.

Maybe worth a virtual billion dollars

[qzzpjs]

Unless they can actually cash out that billion at any moment, I wouldn't consider it real.

Re:Maybe worth a virtual billion dollars

[Anonymous Coward]

So I guess the stock market isn't real either.

You can't take that much money out of a bank in one go either. I guess banks aren't real.

Re:Maybe worth a virtual billion dollars

[sobachatina]

You only consider wealth real if it is entirely liquid!?

No one with that much money can liquidate it instantly- at least not without losing some of it.

What if they owned a Billion of real estate? You think they'd be able to dump in in one weekend?

Re:Maybe worth a virtual billion dollars

[Anonymous Coward]

Exactly. There have been consistent problems with being unable to extract your cash from bitcoins in any of the bitcoin services. Some simply stop working for hours or days at a time. Others have a daily limit of about $2,000 (which means it would take about 1,500 years for them to get their money out). Bitcoin is still, overall, a fucking scam.

Re:Maybe worth a virtual billion dollars

[110010001000]

Correct. Until you sell your stock investment you haven't made any money at all. That is why you are taxed on sale.

Re:Maybe worth a virtual billion dollars

[Anonymous Coward]

This is a textbook example of how ridiculous it is that any one person can accumulate that type of wealth in the first place.

Re:Maybe worth a virtual billion dollars

[Anonymous Coward]

The difference is you can go to the bank wand get a loan with your buildings as collateral.
Not sure you can do that with bitcoin.
Also, with stocks you can liquidate a lot faster than with bitcoin.

Re:Maybe worth a virtual billion dollars

[Anonymous Coward]

All very true.

However, Bitcoin doesn't have an inherent use or value, only ascribed value. If I decide to cash out of my real estate, its value is based on its usability. If I decide to cash out of Bitcoins, that value is based purely on agreement. Agreement of what? Mostly, the agreement is that those invested in Bitcoin want the value to be as high as possible.

Unfortunately, that's not enough incentive for me as a non-Bitcoin owner to buy in. My job as a purchaser is to get value for my currency, not to enrich people who got in on the scheme before me.

Long term, there is no bound on the value of Bitcoin. It can go up forever. At some point though, people might realize that trading inflated stock prices, based on non-existent companies, purely on the fact that they can't find better investments, is not a good plan. At this point, note that those invested in the scheme will not allow the price to collapse. Instead, they will keep trading amongst each other to cover their positions, however, not be able to find any more buyers. So, cash out will stop. Good luck with all your billions then.

Note that any notion of pre-freeze equilibrium being met won't happen because that equilibrium is notionally the same as the freeze. This forms an induction of equilibriums which clearly isn't happening, because people have actually bought in for a variety of reasons.

TLDR: The price can go up forever. As price goes up, the barrier to buying goes up because of lack of backing. At some point the barrier becomes impassable. It's unlikely that price will meet equilibrium before that.

Re:Maybe worth a virtual billion dollars

[Anubis IV]

I agree that having assets that are fully liquid is a silly standard to hold something to, but that's not the issue here. If you own real estate, its value may change over time, but selling your properties wouldn't drive the fair market price down across the entire market. There's nothing stopping you from selling any or all of your properties fortheir full value. Those assets may not be liquid, but they still have a worth that can, for all intents and purposes, be redeemed at full value.

In contrast, when someone owns a large chunk of stock in a company, the very act of attempting to sell that stock usually devalues the stock to the point that they aren't actually getting anywhere close to the price on paper. The problem isn't that they aren't liquid: the problem is that not all of the stock can be redeemed at full value, and because the stocks can't be redeemed at full value, they aren't actually worth what they're listed at.

Re:Maybe worth a virtual billion dollars

[alvinrod]

I don't know how true this is, but I've heard that many of these wealthy people will take out large loans and default on them and pay it off with stock, which doesn't count as a sale. Essentially it allows them to get around the taxes. There may be more to it than that, or it may have been some loophole that's since been closed, but it seemed like the type of scheme bankers would dream up.

Re:Maybe worth a virtual billion dollars

[religionofpeas]

Try withdrawing $1 billion from a bank account at any moment. Maybe that's not real money either.

Re:Maybe worth a virtual billion dollars

[WrongMonkey]

Any valuation of wealth is speculative until it is actualized into the denomination specified. Even when converting between two different currencies. If I have a few leftover euros in my pocket after a trip, their worth in US dollars is speculative until I actually make the exchange.

Re:Maybe worth a virtual billion dollars

[Pascoea]

If I decide to cash out of my real estate, its value is based on its usability. If I decide to cash out of Bitcoins, that value is based purely on agreement.

I disagree. The value of either of those things is how much someone is willing to pay you for them at the time that you want to sell them. Doesn't matter if it's a house, a dollar bill, or a bitcoin.

Re:Maybe worth a virtual billion dollars

[AlanBDee]

There is a similar scheme involving whole life insurance. If I understand it correctly (and I don't promise that I do) you can put your money into the whole life policy. As it grows you would have to pay taxes on it if you pull it out. Instead of pulling it out you get "loans" against the policy which is tax free. Then, when you die, the policy passes to your heirs tax free as part of the policy pay-out. https://www.nerdwallet.com/blo...

It looks good on paper but I actually question how well it really works. For example: if your investment only grew at a meager 4% in the life insurance policy after fees while an index mutual fund grew at 8% then you'd better off just paying taxes on the growth of the index fund. (The actual numbers depend on your tax level but you get the idea)

I have no intention of getting a whole life insurance policy to do this.

Re:Maybe worth a virtual billion dollars

[swillden]

That scheme seems very unlikely to pass the IRS' smell test. I can see it happening one year, but the IRS would tighten the regulations immediately. They have large discretion with figuring out how to determine income, for exactly that reason.

Re:Maybe worth a virtual billion dollars

[ghoul]

That only matters if you own a significant chunk of the company's stock. In this case the Bros own 1% of the BTC valuation. 1% is not even a blip given that the average trade volume is 100% of the valuation. The 1% could be broken into .001 percent 10 million trades and sold over a quarter with nooone even getting to know.

Re:Maybe worth a virtual billion dollars

[Streetlight]

I'm guessing transfer of ownership is a sale, but like you I'm unsure. The only sure way I know of avoiding paying taxes on the transfer of asset title is inheriting them. When a person dies the cost basis of the assets is reset to their value as of the date of death. Of course the estate owner isn't seeing any gain. The value of the estate my result in the estate paying inheritance taxes which might reduce the value of the inheritance. Any income tax due the heir would come from the increase in value of the inheritance during the probate period. If a decedent invested $100 K and at death the value ended up worth $1,000 K, the heir would not pay taxes on the $900 K gain, nor likely would the estate. If during the probate period the $1,000 K gained $10K in value, then the heir would pay federal income taxes on the $10 K. Individual states may have different situations.

Any decent estate lawyer should be able to pass the $1,010 K through to the heirs untaxed with the heir paying federal income taxes only on the $10 K gain. The tax brackets for federal income taxes on gains for estates are not like those for ordinary income taxes and incredibly high. IIRC, the highest bracket is ~40% on income above $12,500.

Re:Maybe worth a virtual billion dollars

[Streetlight]

I should have mentioned that when a spouse inherits upon the death of a husband or wife, there are nor taxes owed

Re:Maybe worth a virtual billion dollars

[Anonymous Coward]

Bitcoin IS money. Good money. Good money drives out bad money. I made money the instant I traded my weak U.S. dollars for strong Bitcoin. I "cashed in," and I'm never cashing out. In a few years, when nobody wants dollars anymore, I'll start spending it directly.

Re:Maybe worth a virtual billion dollars

[Anonymous Coward]

That is totally untrue about stocks. You're looking at a 48-hour settlement period. Then if you want cash money, your broker will drag its heels. Sell bitcoin and the money goes directly into your account.

And I'm pretty sure bitcoin can be used as collateral.

Re:Maybe worth a virtual billion dollars

[mattack2]

If you own real estate, its value may change over time, but selling your properties wouldn't drive the fair market price down across the entire market.

The _entire_ (considering country by country here) market, sure. Couldn't you easily drive down the fair market price of the local (city, county, maybe even state for small states) market? e.g. if a bunch of houses in an area sell at way below what recent sales were at, then the comparable market value goes down, thus affecting future sales in the area, and property tax valuations, etc. (Ignoring our weird Prop 13 property tax situation.)

Re:Maybe worth a virtual billion dollars

[bobbied]

I'm sure the insurance company loves this scheme.... I'm also sure that they profit handsomely from selling folks on the idea that it works.

What's that saying? The only sure things in this world are "Death" and "Taxes" and you may delay them for a time, but you cannot cheat them forever.

Re:Maybe worth a virtual billion dollars

[ceoyoyo]

It's not. And that fact has caused a few problems over the years.

Re:Maybe worth a virtual billion dollars

[maglor_83]

I agree that having assets that are fully liquid is a silly standard to hold something to, but that's not the issue here. If you own real estate, its value may change over time, but selling your properties wouldn't drive the fair market price down across the entire market. There's nothing stopping you from selling any or all of your properties fortheir full value

If you had a significant share of the property market, and tried to sell it all at once (ie exactly the situation we're comparing to), then yes it would certainly negatively effect the prices you could sell for.

Re:Maybe worth a virtual billion dollars

[Anonymous Coward]

Greetings from the real world! I have to wave now before you're out of sight over the horizon of Crazy land!

Re:Maybe worth a virtual billion dollars

[Anubis IV]

I quite agree that if someone owned enough of the real estate market they'd have the same problem, but that actually gets at the point I was making.

The sort of thing we're talking about here—where a person owns so much of something that the sale of some devalues the price of the rest—is essentially never a problem in real estate due to the size, diversity, and maturity of the market, yet it IS a problem in cryptocurrencies and stocks, where a single person can own or control a large amount. Were the situations the same, you're right, they'd have the same problem, but the situations aren't the same, hence the problem.

Re:Maybe worth a virtual billion dollars

[Anonymous Coward]

Disagree all you want. As long as we don't agree, I won't do business with you.

Re:Maybe worth a virtual billion dollars

[Rolgar]

Your loans are going to cost you interest which will reduce your cash in your policy, unless the loan is small enough that the interest growth on your remaining cash is strong enough to counter the interest on the loan. If you outlive your policy because the cash value evaporates, you will have to pay the taxes, and there will be no death benefit.

You can however take out the initial principal, as a return of premium which is money you already paid taxes on, without having to pay any taxes.

Re:Maybe worth a virtual billion dollars

[Pascoea]

Well shit, now I've gone and done it! Some random anonymous dude on the Internet isn't going to do business with me.

As long as we don't agree, I won't do business with you.

You just summarized every consensual transaction ever. Generally people don't do business unless they can come to an agreement. If I'm trying to sell you a bitcoin, house, or a bar of gold the transaction likely isn't going to take place unless we can agree on a price.

Better business model

[slashmydots]

I think they found a better business model. Facebook sells user data, especially to the NSA, spies on everyone, abuses monopolies and patents, violates multiple countries' laws, and lies about everything all the time. Bitcoins fight oppression and discrimination from the World Bank and UN, fights manipulative billionaires, fights Wall Street assholes, and fights oppressive governments. Bit a difference there.

Re: Better business model

[Anonymous Coward]

bitcoins dont do a fucking thing. people do. like guns. ya know.

Re:Better business model

[Anonymous Coward]

I think they found a better business model. Facebook sells user data, especially to the NSA, spies on everyone, abuses monopolies and patents, violates multiple countries' laws, and lies about everything all the time. Bitcoins fight oppression and discrimination from the World Bank and UN, fights manipulative billionaires, fights Wall Street assholes, and fights oppressive governments. Bit a difference there.

Except bitcoin will eventually lose the fight.

Greed N. Corruption will remain king, no matter what. The "better" business model depends on what you value. If revenue is the ultimate goal no matter the cost, than the traditional methods will be best, as they will continue to dominate.

Re:Better business model

[icejai]

If you think Bitcoin fights manipulative billionaires and Wall Street assholes, you're in for a seriously rude awakening once Bitcoin futures starts trading on the CME.

Re:wait for it to drop when someone trys to unload

[JaredOfEuropa]

So you don't unload the entire block all in one go. Just like people do on the stock market. Demand for BTC remains pretty strong (still plenty of speculators eager to take a gamble), so they can sell smaller blocks on the way up. I bet they've already started doing that a while back.

Cash out

[Anonymous Coward]

Just curious - how easy is it to cash out large amounts of Bitcoin in a short amount of time?

Re:Cash out

[gatfirls]

Really easy, it just crushes the price as it tears through sell walls because of relative low volume.

Re:Cash out

[religionofpeas]

Obviously you wouldn't sell at market price.

Re:Cash out

[gatfirls]

Well in that case, it's really hard.

I hope they didn't put it in Mt. Gox

[poached]

Because you know, that would be sad.

Slashdot

[gatfirls]

..The premier news source for bitcoin.

Re:Slashdot

[leonbev]

I'm convinced that the new owners of Slashdot have a big stake in Bitcoin, and this is how they make their money.

Hey... it beats interstitial advertising, anyway.

Re:Slashdot

[c]

I'm convinced that the new owners of Slashdot have a big stake in Bitcoin

Naw. The old owners pushed Bitcoin stories... minimum one story per week. It was annoying then, too.

I suspect the new guys just haven't figured out where the Bitcoin-story-approval cron job is being run from.

Re:Slashdot

[Anonymous Coward]

More likely they required buying out their bitcoins as part of the sale... turns out it was the best way to cash out your bitcoin stash.

Re:Slashdot

[Actually, I do RTFA]

Hey... it beats interstitial advertising, anyway.

My adblocker blocks interstitial ads. Bitcoin stories, not so much.

Re:Slashdot

[david_thornley]

There may be a market opportunity there....

Reality of All Billionaires

[sycodon]

This is the same reality faced by Bill Gates, Bezos, Musk, Buffet, etc.

Billionaires don't have a billion dollars. In fact their actual income is quite modest compared to what you think when you say, "Billionaire". Wealth doesn't mean cash in your bank account.

To be sure, they have NO financial hardship, even if they spend like idiots. But they don't "have" a billion dollars in cash.

Re:Reality of All Billionaires

[alvinrod]

You don't need a billion dollars (or really even a million for that matter) in cash for any reason. What the hell would you actually buy with it? Perhaps you could perform a (hostile) takeover of some other company that's publicly traded or just for sale by the owner, but the kinds of people who'd do that would be looking at it as an investment instead of like buying a car.

You don't even need to be cash rich at all as long as you're just rich. Banks will always be willing to lend you money when you have billions of dollars worth of assets.

Re:Reality of All Billionaires

[WrongMonkey]

Exactly! I've tried to explain this many times and usually get modded down. Valuation of personal wealth based largely on securities should not be compared to cash in the bank.

This is a real problem for the Gates Foundation because it limits how much they can cash out to spend before it disrupts the stock market.

Re:Reality of All Billionaires

[sycodon]

Even with a hostile take over, most of the consideration is in the form of shares.

Re:Reality of All Billionaires

[Anonymous Coward]

If they have a $1B hoard of BC, but it's not cash, then what the hell is BC good for? Is it not a currency?

BC is as liquid as cash,... Unless I didn't RTFM...

Re:Reality of All Billionaires

[Anonymous Coward]

Cmon, this is bullshit.

You can make huge private securities transactions away from the markets, whether as an individual or as a corporation.

If Bill Gates wanted $1 Billion in his checking account 24 hours from now, organisations would be lining up around the block to accomodate his wishes by whatever means necessary.

Re:Reality of All Billionaires

[Pieroxy]

Cash is something guaranteed by your government to have a very specific value. USD, Euro, etc. BC is not cash.

Some will say it's better, but it is still not cash.

Re:Reality of All Billionaires

[K. S. Kyosuke]

Is it not a currency? BC is as liquid as cash

Perhaps, but I'm not sure what is the current exchange rate on provinces of Canada.

Re:Reality of All Billionaires

[Killall -9 Bash]

If currency was guaranteed to have a specif value, inflation wouldn't be a thing.

Re:Reality of All Billionaires

[swillden]

This is the same reality faced by Bill Gates, Bezos, Musk, Buffet, etc.

Yes and no.

Founders cashing out does temporarily lower the stock price, but it's usually not too bad unless investors believe they're bailing because they know something (the knowledge can't be specific, current non-public data; that would be insider trading, but it can be application of the same level of insight that led them to become successful in the first place). This is true even when the Founders own significantly more than 1% of the stock. Divestiture of a mere 1% would rarely cause a big downward movement, even if it hit pretty fast.

In the case of BTC, though, because the real value of a BTC as an exchange medium is pretty weak (due to the scaling issues), nearly all of the BTC value is bubble-driven. In that sort of situation, a 1% sell-off could easily trigger a catastrophic collapse.

Re:Reality of All Billionaires

[Anonymous Coward]

While you are correct about "Bill Gates" and "$1 billion" you are missing the bigger picture about 100% conversion of large positions of equity to cash. This can't happen for many other reasons, like the signal it sens the market and liquidity issues.

Re:Reality of All Billionaires

[mindstormpt]

Slashdot: Jeff Bezos Just Sold $1.1 Billion in Amazon Stock

You're funny.

Re:Reality of All Billionaires

[sinij]

What the hell would you actually buy with it?

Bill, you lack imagination.

You can borrow some items from my list:
a. Secret Moonbase
b. Underwater dome city
c. My personal scramjet orbital-capable shuttle
d. A modern pyramid for personal mausoleum
e. Opening temples of Church of Spaghetti Monster across the nation.

Re:Reality of All Billionaires

[chispito]

Because it seems like it's on the tip of your tongue, I think the word you're looking for is "liquidity."

Re:Reality of All Billionaires

[mattack2]

This is very often made clear. You just say that they have over a billion dollars "on paper".

Re:Reality of All Billionaires

[Kjella]

Bezos, Musk they're still leading and building their rapidly expanding company, no idea what Buffet is up to... Gates? Microsoft is an established giant and he's stepped down as chairman and diversified his portfolio, owning just 1.3% of Microsoft now.... he could probably cash out $10 billion tomorrow by just selling across the board.

Re:Reality of All Billionaires

[Anonymous Coward]

"I'll tell you what I'd do, man: two chicks at the same time, man."

Re:Reality of All Billionaires

[Anonymous Coward]

Insider trading is all but unenforced. The last time it was used in the past decade was against someone who ticked off some politicos.

If someone had a large number of BTCs, and were wanting to get out, their best thing to do is cash them in all at once. That way, any shifts in the market would not affect them, as the market prices would change after the transaction.

Re:Reality of All Billionaires

[wagnerer]

1) The guarantee is that they will give you one dollar for a $1 bill. Says right on it.
2) That's a federal reserve guarantee, not the us government.

Re:Reality of All Billionaires

[h4ck7h3p14n37]

Billionaires don't have a billion dollars. In fact their actual income is quite modest compared to what you think when you say, "Billionaire". Wealth doesn't mean cash in your bank account.

At a certain point finding places to put your wealth becomes an actual problem. Wealthy people don't have a big vault where they keep their money like Scrooge McDuck, they have to invest it in things. That's one of the reasons I detest class warfare and demonizing the successful. It's those evil wealthy people that invest in companies and hire employees, that buy expensive products and who pay the majority of the bill for the social safety net. And yet people keep accusing them of not paying their "fair share" when they are already paying their share along with a lot of other peoples' share.

Re:Reality of All Billionaires

[Anonymous Coward]

Cash is something guaranteed by your government to have a very specific value.

WTF?!? Got any evidence of that? (And if you're going to use the US as an example, make sure your evidence is dated later than 1971.)

I think you will not find anything confirming your idea, but tons of evidence disproving it. You don't know what a dollar is worth, and neither does anyone else.

Re:Reality of All Billionaires

[Anonymous Coward]

Does the same thing apply to gold and silver? Since gold is not considered legal tender it has no intrinsic value, its value is only whatever someone is willing to pay you for it.

All these gold and silver spammers advertising on TV and Radio telling people that gold is a hedge against uncertainty are basically doing exactly what BitCoin is doing.

Re:Reality of All Billionaires

[evilRhino]

The human brain doesn't comprehend numbers that large consciously. Even 1/10 of a billion dollars will last 1,000 years spending $100,000/year. This is not even accounting for any interest on the principal, and considerably higher than median household income in the US. If they were able to recover even a fraction of the amount, they are set for life even if they spend exorbitantly.

Re:Reality of All Billionaires

[Anonymous Coward]

you are missing the bigger picture about 100% conversion of large positions of equity to cash.

I think the point was that Bill Gates can sell $1 billion worth of stock to another billionaire as a private sale. Presuming that the other person actually has $1 billion in cash, after the transaction, Gates would have a billion in cash, and the other person would have a billion dollars worth of Microsoft stock. If the new stock owner tried to sell that stock, then it would trigger the market alarms you are talking about on the open market.

Re:Reality of All Billionaires

[tattood]

Is it not a currency?

And now, you finally understand!

Re:Reality of All Billionaires

[Comrade Ogilvy]

And yet people keep accusing them of not paying their "fair share" when they are already paying their share along with a lot of other peoples' share.

Depends on what you mean by "fair share". The most common argument, endorsed by some people of significant sophistication and perspective like Warren Buffet, is that most very wealthy pay a lesser percentage of their income in taxes than the typical middle class taxpayer.

Re:Reality of All Billionaires

[14erCleaner]

What the hell would you actually buy with it?

Today's stylish billionaire starts his own space program.

Re:Reality of All Billionaires

[WrongMonkey]

Could Bill Gates get $1 billion cash in 24hrs? Sure. But Bill Gates is supposedly "worth" about $70 billion. How much of that could he get in cash in one year? What happens to markets when word gets out that Gates is cashing out everything?

Re: Reality of All Billionaires

[Anonymous Coward]

I'd build a town for people with aspergers focused on self sufficiency and technological research, pretty much innawood.org

Re: Reality of All Billionaires

[Anonymous Coward]

For large values of tulip bulbs, I mean bitcoin, to be valuable, you need a secondary market. That way you can sell derivatives (for dollars) to suckers, backed by your worthless hashes. Make it complex enough and you can even get loans on top of it too.

Then when the worthless asset is recognized as maybe not rising as fast and collapses, your wealth isn't really in bitcoin. Because you foisted it off onto suckers.

Re:Reality of All Billionaires

[Enigma2175]

It's those evil wealthy people that invest in companies and hire employees, that buy expensive products and who pay the majority of the bill for the social safety net. And yet people keep accusing them of not paying their "fair share" when they are already paying their share along with a lot of other peoples' share.

Do they pay the majority of the bill for the social safety net? People who carry water for the wealthy often cite the percentage of the federal income tax that the wealthy pay (which is going down greatly under the new tax plan), but most of the safety net (Social Security and Medicare) are not paid from income tax revenue. Since Social Security is only paid on the first $127k of income, wealthy people end up paying a much lower percentage of their income for this tax than the middle class. The Medicare tax hasn't historically been progressive (however, it recently added a 0.9% addition for incomes over a certain level) so wealthier people pay a similar percentage of their income compared to other people. So just exactly what part of the social safety net is the rich paying "the majority of the bill for"?

Re:Reality of All Billionaires

[larryjoe]

And yet people keep accusing them of not paying their "fair share" when they are already paying their share along with a lot of other peoples' share.

Depends on what you mean by "fair share". The most common argument, endorsed by some people of significant sophistication and perspective like Warren Buffet, is that most very wealthy pay a lesser percentage of their income in taxes than the typical middle class taxpayer.

Fairness always depends on the specific metric of interest. Aside from the ability to contribute financially, owners of more property also consume more governmental services and resources. For example, a rich person has a greater need for fire protection services than a homeless or indigent person. Transportation infrastructure yields convenience for poor people but is a business necessity for business people.

Re: Reality of All Billionaires

[Anonymous Coward]

Itâ(TM)s a million dollars a thousand times. Itâ(TM)s big but certainly not incomprehensible...

Re:Reality of All Billionaires

[Rakarra]

I think you will not find anything confirming your idea, but tons of evidence disproving it. You don't know what a dollar is worth, and neither does anyone else.

Money, like everything else in the world including gold, is worth exactly as much as we think it does.

Re:Reality of All Billionaires

[skegg]

but it's usually not too bad unless investors believe they're bailing because they know something

Very true. That's why founders at this level only cash-out small amounts (small by their standards, not mine !) and even then announce the share sale well ahead, so that the market is minimally spooked.

Re:Reality of All Billionaires

[discovercomics]

Bezos doesn't have any issues selling a Billion or so of amazon stock each year. He does that with regularity to finance Blue Origin.

Re: Reality of All Billionaires

[Anonymous Coward]

Are you sure?
https://www.sec.gov/spotlight/insidertrading/cases.shtml

Re:Reality of All Billionaires

[Anonymous Coward]

[...] But they don't "have" a billion dollars in cash.

Unless they're Vera Donovan from "Dolores Claiborne"... "I'm sorry, I'd help but all my money's tied up in cash!

Re: Reality of All Billionaires

[Anonymous Coward]

It is hard to spend as bitcoin, so it is more like an asset like gold. Selling 1% of the world's gold would affect price. Heck, gold bugs claim governments manipulate the price with much less

Re:Reality of All Billionaires

[Anonymous Coward]

So just exactly what part of the social safety net is the rich paying "the majority of the bill for"?

welfare and unemployment insurance. There. It wasn't that hard to explain.

Re: Reality of All Billionaires

[reanjr]

Selling all at once doesn't magically make buyers appear at the spot price.

The best strategy is to place a sell order for your riches at the current spot price and let buyers trickle in and scoop up little bits of your offer until you're divested.

Re:Reality of All Billionaires

[Pieroxy]

The definition, just the definition: https://en.wikipedia.org/wiki/...

I equated cash with FIAT currency, because for now in most country they are indistinguishable.

Re:LIST OF FAGGOTS

[DickBreath]

You are not very good at making lists.

I was dreamin' when I wrote this

[Anonymous Coward]

Forgive me if it goes astray
But when I woke up this mornin'
Coulda sworn it was judgment day
The sky was all purple,
there were people runnin' everywhere
Tryin' 2 run from the destruction,
U know I didn't even care

'Cuz they say two thousand zero zero party over,
oops out of time
So tonight I'm gonna party like it's 1999

All these asset bubbles and folks defending them tooth and nail saying they're based on "facts" or "Fundamentals" without having ever read a financial statement or understanding the market they're speculating in.

Oh, we're coming to a bloodbath and I'm going to enjoy every minute of it and the $$$$$$$$$ - especially when I tell Tesla "investors" how stupid they are.

Re:LIST OF FAGGOTS

[Anonymous Coward]

Because they forgot you?

Re: LIST OF FAGGOTS

[Anonymous Coward]

Creimer go home, you are drunk.

Re:wait for it to drop when someone trys to unload

[Joe_Dragon]

the exchange does have the cash to pay out much and with no gov regs they just give you an IOU and keep the coins.

Re:LIST OF FAGGOTS

[Anonymous Coward]

you forgot 0011001001001

IY Cryptocurrency Mining...

[Anonymous Coward]

If you want mine your own crypto currency, you need a motherboard with 19 PCIe 1X slots to plug in 19 GPUs and a couple of 1200W PSUs.

Bitcoin .... its a TRAP!

[Anonymous Coward]

Bitcoin is a trap. Its purpose if for "greed" to "invest" in it but your money will never come out or ever be returned to the physical world. Try today and take a try at "cashing out" say I don't know - 100 bitcoins. The average company is not going to have 1,000,000 on hand for you? But - keep investing in bitcoin - that's exactly what the "inventor" wants you to do ( an inventor that apparently doesn't want to be know or will not stand behind their invention)... till one day it all goes POOF! Unfortunately - this is going to consume somebodies hard earned money

The Winklevoss with being fooled ONCE.... They are lucky they didn't "invest" the whole lot of cash.....

They shouldn't have named it Bitcoin - they should have named it GG - "Greed Gone"

Re:Bitcoin .... its a TRAP!

[MikeDataLink]

Bitcoin is a trap. Its purpose if for "greed" to "invest"

1) Why does making money always equal greed in some people's minds? What's wrong with striving for more than you have?

2) You could say this about any investment. Even physical ones like rental property. The market could literally collapse overnight and make your properties worth less than you owe on them, and indeed it has happened numerous times in history.

3) Rule #1 of investing. Don't invest money you can't afford to lose. It's always at risk in any investment. Risk is the nature of investing.

Big Whoop! I'm an Eve billionaire!

[arfonrg]

More of a tangible currency than BC.

Another example of the insanity of Capitalism

[Anonymous Coward]

If they were to sell (which they probably can't), then:

* They will have gotten about a Billion dollar's worth of wealth - a life's savings of, say, a 100,000 farmers in an underdeveloped country.
* Tens of thousands of gullible individuals who think they would get rich off BitCoin will have paid that 1 Billion, only to lose most of that money later. And if they're not the ones who lose, then the next round of buyers.

Re:LIST OF FAGGOTS

[DickBreath]

When Santa makes a database he verifies it twice to insure data integrity.

Re:LIST OF FAGGOTS

[DontBeAMoran]

I'm not a faggot, I'm a furry! Get your facts straight!

Dear Winklevoss Twins

[Anonymous Coward]

Can you send two dozen Bitcoins to 17Yvsma9tfiuqVP7QhsFE2VmsFpTEMy17P?

Thank you very much in advance.

No, they are not.

[TeknoHog]

With a hard cap of 21 million bitcoins in total, nobody will ever be a Bitcoin billionaire. I'm not even sure if there are Bitcoin millionaires, though Satoshi could well be one.

Re:No, they are not.

[TeknoHog]

Also, why say "1 percent of the entire currency's dollar value equivalent"? They have 1 percent of total coin supply, and that won't change whether you compare 1 BTC to Euro or whatever.

Re:No, they are not.

[EndlessNameless]

He's a billionaire in America because the current value of those Bitcoins exceeds one billion dollars.

In case you're pedantic rather than ignorant, I'll remind you that net worth is calculated by converting all assets and liabilities to dollars at current market prices. This is entirely consistent with how traditional stock-and-bonds billionaires are assessed.

Re:No, they are not.

[TeknoHog]

He's a billionaire in America because the current value of those Bitcoins exceeds one billion dollars.

I agree with that. However, in the greater world, simply saying "billionaire" is not enough, so it's better to specify the currency. For instance, a dollar billionaire might not be a euro billionaire. Using the same logic, a bitcoin billionaire would mean having a billion bitcoins. Of course, this assumes that you treat Bitcoin as a currency.

Stocks etc. are different because you might have different types of share for each company. There's no single unit of Nokia share, for example, so it's easier to agree that a "Nokia millionaire" has a million local currency units worth of the company.

Re:wait for it to drop when someone trys to unload

[Aighearach]

Wait, no government regs? Who told you that? Not a lawyer, that's for sure.

I'm not a lawyer either, but I at least know that all currency is government-regulated, including private currencies. It is obvious if understand that the US only had private currencies at the beginning!

"The Securities and Exchange Commission (Commission) treats securities crimes committed with Bitcoin and VCs as money"
https://en.wikipedia.org/wiki/...

Anything you use as money is already currency and already regulated. If you don't like it, just buy a big truck and carry chickens around with you to barter for goods. Be advised you still have to calculate the dollar equivalents and pay taxes.

Re:LIST OF FAGGOTS

[Aighearach]

I assure you, Santa would not insure his list, if he was worried about he'd just wiggle his nose to ensure the data integrity!

Not really... look at Ars

[CrashNBrn]

bitcoin site:arstechnica.com :: About 48,700 results (0.51 seconds)
bitcoin site:slashdot.org :: About 4,460 results (0.46 seconds)

Re:Not really... look at Ars

[gatfirls]

hyperbole
hprbl/Submit
noun
exaggerated statements or claims not meant to be taken literally.
synonyms: exaggeration, overstatement, magnification, embroidery, embellishment, excess, overkill, rhetoric; More

Anyway, it's not the fact that pretty much 1 out of the 10 stories a day is about bitcoin, it's that they are completely uninteresting. This one is basically "Rich people have money"

Re:Not really... look at Ars

[ceoyoyo]

To be fair, this story is more like Winklevoss twins were crazy enough to dump $11 million into bitcoin back when it was $120/coin.

Good luck selling that...

[enriquevagu]

They only need 1 000 000 people investing $1 000 into bitcoin to cash out.

Re:Good luck selling that...

[ghoul]

Over 300 million folks have bought iPhones when you can make calls from a 5 dollar flip phone. Sometimes a need is not known to exist till a product is created. BTC is a product and needs are constantly getting invented for it.

Re:wait for it to drop when someone trys to unload

[torkus]

The exchange facilitates your purchase or sale...and transfer of funds to/from your bank account. They don't hold the cash to buy everything out...

You want to sell, 10BTC...well when theres 10BTC looking to be bought at your asking price, that money goes from the buyer, through the exchange, and to you. Why is this complicated to understand?

Satoshi Nakamoto Did it First

[DanielRavenNest]

Whoever he/she/they are, they have an estimated 800K bitcoins, from being the first miner, in the days it was easy. We know those coins have never moved since being mined, because the blockchain tracks every transaction. So they would have become a billionaire for the first time, when the price peaked in Nov, 2013, then again in Mar and Apr of 2017 when it crossed $1250/BTC.

It is always possible those early coins are lost, or the private keys intentionally destroyed. It is also possible Nakamoto is waiting until they can buy HSBC, just because they can. The message in the Genesis Block (the first one in the blockchain) is "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks", so they are not a fan of banks.

Re:Satoshi Nakamoto Did it First

[bobbied]

Classic pyramid scheme... The folks in on the ground floor make money. Other people may make money as the scheme progresses... Then Everybody left loses all they invested once it falls apart.

Looks can be deceiving I guess, but not unusually.

Re:Satoshi Nakamoto Did it First

[Anonymous Coward]

Only problem is these Bitcoins have NEVER been moved which entirely undermines your argument it's a pyramid scheme.

Re:Satoshi Nakamoto Did it First

[Anonymous Coward]

So like, the gold rushes were also a pyramid scheme? How unfair! The first people to get in got the easy stuff, by the time most people had heard about it, it was too late.

Sounds a lot like BTC, Sounds at like you're kicking your self in the ass because you ... missed out? :-) or think you missed out because how could this crazy thing go any higher? But haven't you already though that several times already, and kept holding out waiting for it to go bust so you fell better about your self and say I told you so!!!

Snooze you lose.

Re:Satoshi Nakamoto Did it First

[Xyrus]

The message in the Exodus block is "Drink Your Ovaltine."

They can buy a pizza!

[Anonymous Coward]

WOW. That's it Im TOTALLY convinced I should flush all my monies down the bitcoin drain!

Mods are whores.

The Winklevoss twins are douche bags...

[Anonymous Coward]

The only two people on the planet who can make Mark Zuckerburg look better in comparison.

Source: "The Accidental Billionaires: The Founding of Facebook: A Tale of Sex, Money, Genius and Betrayal" by Ben Mezrich

Re:The Winklevoss twins are douche bags...

[Rakarra]

The only two people on the planet who can make Mark Zuckerburg look better in comparison.

Source: "The Accidental Billionaires: The Founding of Facebook: A Tale of Sex, Money, Genius and Betrayal" by Ben Mezrich

Yeah, he basically took Eduardo Saverin's story and fictioned it up a little bit. No surprise, that story makes Saverin seem like a saint, and everyone else like a horrible asshole and/or the devil. It also shouldn't shock anyone that serial character assassin Aaron Sorkin liked it enough to adapt it for the Social Network.

And some who tried it wound up in tax court.

[Anonymous Coward]

Some of those who tried the "take out a loan with stock as collateral, then default on the loan" have ended up in tax court, where the courts have treated the transaction as a sale, with all taxes associated with it being a sale.

Re: wait for it to drop when someone trys to unloa

[Anonymous Coward]

Like the exchange wouldn't "be hacked" (by insiders )midway through the billion dollar transfer.

Cornering Silver Market?

[Anonymous Coward]

Are these the same brothers that tried to corner the silver market to manipulate prices?
I think someone probably with help of miners is doing that here to force prices unnaturally high.

Re:LIST OF FAGGOTS

[Rakarra]

I'm not a faggot, I'm a furry! Get your facts straight!

They're not mutually exclusive.

Upoming craash

[manu0601]

Will they convert to something less volatile before bitcoin value crash?