Bitcoin, the semi-anonymous digital currency, has weathered plenty of criticism and controversy over the years, but today it faces its biggest challenge: the FBI takedown of its largest market, the underground site Silk Road.
Following that news, Bitcoin prices fell from a steady price of around $128 per Bitcoin over the past week to a low of $85 this morning, according to the Bitcoin market tracker Blockchain.
According to the FBI’s indictment against Silk Road, the site was managing more than $1.2 billion in revenue, all powered by Bitcoin, so it’s not a huge surprise to see the overall market for the currency fall apart.
The time to buy is now
At the time of this post, the average Bitcoin price was $112.64, but there were dramatic differences across the various Bitcoin exchanges (popular exchange Mt. Gox is showing a $123.33 price, while CampBX shows a far lower $103.76 price).
With Silk Road gone, along with its plethora of easy to purchase illegal substances, many people lost the Bitcoins sitting in their accounts on the site. That, coupled with the loss of faith from other Bitcoin holders, likely led to today’s dip.
But the fact that Bitcoin prices are rebounding fairly steadily also tells us that others are buying up the digital currency, with the hopes that the value will once again rise to $128 and above.
While things seem to be getting back to normal for the Bitcoin market, the loss of a $1.2 billion marketplace will be felt for some time.