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This is true of any company equity as well. If Bezos decided to unload his entire stake in amazon, for example, the stock price would tank. At that level, it'

This is true of any company equity as well. If Bezos decided to unload his entire stake in amazon, for example, the stock price would tank. At that level, it's all based on valuation, not liquidation value

noobermin 9y ago
I'm pretty sure bitcoin is hell of a lot more illiquid than amazon stock is...
- bestnameever 9y ago
  Well, according to marketwatch, if I am reading it correctly, the average trade volume of Amazon stock is 3.5 million. USD trade volume of bitcoin is between 2 and 11 trillion. https://www.marketwatch.com/investing/stock/amzn https://www.marketwatch.com/investing/stock/amzn https://coinmarketcap.com/currencies/bitcoin/historical-data/ https://coinmarketcap.com/currencies/bitcoin/historical-data...
MBCook 9y ago
Right, but there is a fundamental value to Amazon. The stocking never go to zero dollars just because of Bezos selling because the company is clearly worth more than that. If the Winklevoss twins tried to sell just 1% of their stake, $10 million, what would happen to the price of bitcoin? Would they have $990 million of bitcoin left? I’m guessing it would be a hell of a lot less. I think it would cause a panic. I’m not going to say would go to zero, but I’m willing to bet it would drop a TON more than Amazon stock would if Bezos sold 1%.
- sowbug 9y ago
  Not much would happen if recent history is a guide. One day in mid-September 2017, $4.2 billion of Bitcoin changed hands, and the price that day went up about 5%. That volume followed a rumor that China was cracking down on cryptocurrency exchanges. I can't say I spend much time watching the tape, but I have seen >100-BTC trades on GDAX in the past, and at current prices your what-if scenario involves a sale of about 909 BTC. https://www.cryptocoinsnews.com/11-billion-24-hour-cryptocurrency-trading-volume-hits-new-record/ https://www.cryptocoinsnews.com/11-billion-24-hour-cryptocur...
- bestnameever 9y ago
  USD trade volume for bitcoin has been around 2 to 11 trillion in the last month. https://coinmarketcap.com/currencies/bitcoin/historical-data/ https://coinmarketcap.com/currencies/bitcoin/historical-data...
- weddpros 9y ago
  according to the depth chart on GDAX, you could sell 10M$ in BTC and the price would dip by.... les than 300$ to 10850$. 100M$ in BTC would send the price in the 7000s
amorphid 9y ago
If Bezos just hopped into his Etrade account and hit the "sell all" button (just pretend it works that way), the stock would absolutely crater, at least for a bit. In practice, he'd find institutional-ish investors who were interested in buying a sizeable investment in Amazon, and he'd sell directly to them in a private deal. That kind of stuff happens all the time; I think, it's called a block trade... https://en.m.wikipedia.org/wiki/Block_trade https://en.m.wikipedia.org/wiki/Block_trade

noobermin 9y ago

I'm pretty sure bitcoin is hell of a lot more illiquid than amazon stock is...

bestnameever 9y ago
Well, according to marketwatch, if I am reading it correctly, the average trade volume of Amazon stock is 3.5 million. USD trade volume of bitcoin is between 2 and 11 trillion. https://www.marketwatch.com/investing/stock/amzn https://www.marketwatch.com/investing/stock/amzn https://coinmarketcap.com/currencies/bitcoin/historical-data/ https://coinmarketcap.com/currencies/bitcoin/historical-data...

MBCook 9y ago

Right, but there is a fundamental value to Amazon. The stocking never go to zero dollars just because of Bezos selling because the company is clearly worth more than that. If the Winklevoss twins tried to sell just 1% of their stake, $10 million, what would happen to the price of bitcoin? Would they have $990 million of bitcoin left? I’m guessing it would be a hell of a lot less. I think it would cause a panic. I’m not going to say would go to zero, but I’m willing to bet it would drop a TON more than Amazon stock would if Bezos sold 1%.

sowbug 9y ago
Not much would happen if recent history is a guide. One day in mid-September 2017, $4.2 billion of Bitcoin changed hands, and the price that day went up about 5%. That volume followed a rumor that China was cracking down on cryptocurrency exchanges. I can't say I spend much time watching the tape, but I have seen >100-BTC trades on GDAX in the past, and at current prices your what-if scenario involves a sale of about 909 BTC. https://www.cryptocoinsnews.com/11-billion-24-hour-cryptocurrency-trading-volume-hits-new-record/ https://www.cryptocoinsnews.com/11-billion-24-hour-cryptocur...
bestnameever 9y ago
USD trade volume for bitcoin has been around 2 to 11 trillion in the last month. https://coinmarketcap.com/currencies/bitcoin/historical-data/ https://coinmarketcap.com/currencies/bitcoin/historical-data...
weddpros 9y ago
according to the depth chart on GDAX, you could sell 10M$ in BTC and the price would dip by.... les than 300$ to 10850$. 100M$ in BTC would send the price in the 7000s

amorphid 9y ago

If Bezos just hopped into his Etrade account and hit the "sell all" button (just pretend it works that way), the stock would absolutely crater, at least for a bit. In practice, he'd find institutional-ish investors who were interested in buying a sizeable investment in Amazon, and he'd sell directly to them in a private deal. That kind of stuff happens all the time; I think, it's called a block trade... https://en.m.wikipedia.org/wiki/Block_trade https://en.m.wikipedia.org/wiki/Block_trade