Bitcoin Prices Plunge on Bust of Online ‘Black Market’

Bitcoins exist as software that’s designed to be untraceable, making it an attractive tender for those seeking to trade anonymously via the Web. The price for one unit dropped today to about $85 from $127. That’s probably due to speculation that demand for the digital money will shrink after the U.S. government said it seized the Silk Road website, according to Jered Kenna, Chief Executive Officer of virtual-currency exchange Tradehill Inc.

“The question here is: What is it going to do to the Bitcoin ecosystem?” Kenna said in an interview. “Are we going to find out that 90 percent of Bitcoins were used on Silk Road, or that 1 percent of Bitcoins were used there? The Silk Road just threw a lot of uncertainty into it.”

U.S. prosecutors said today that Ulbricht, known on Silk Road as “Dread Pirate Roberts,” ran the site as “the most sophisticated and extensive criminal marketplace on the Internet” from January 2011 to September 2013. The site generated sales of about $1.2 billion and about $80 million in commissions for Silk Road, they said.

Read More: www.bloomberg.com/news/2013-10-02/bitcoin-prices-plunge-on-bust-of-online-black-market-.html