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Bitcoin Collapses Following Silk Road Shutdown

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MTGOX:BTCUSD   Bitcoin / U.S. Dollar
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Today the FBI seized and shut down Silk Road, a website that allowed customers to buy illegal drugs using Bitcoin . As part of the bust, the government took 26,000 Bitcoins , or the equivalent of about $3.2 million, from Silk Road.

Following the news, Bitcoin's value began to collapse.

Here's a chart that shows Bitcoin's collapse today. You can see where exactly where the Silk Road news hits.

Comments

Has anyone considered the possibility that this sell off was the US government liquidating the seized SilkRoad BTC wallets?
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I do think US Dollar will reverse before things get settled with recent news. So in effect this will be a double whammy, and bring bitcoin down lower.
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Would love to see the news that the 26k btc were destroyed (making the left over ones more rare, more valuable)
I also expect the big investor types to rethink their drops since now BTC is cleaner and less problems to sell to their upstanding customers
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Do not overvalue Silk Road. Most of the bitcoin users never ever used Silk Road or any service like that.
This small collapse mostly comes from daytraders which sold high after reading the news yesterday, in the hope to get a cheaper entry point.
April was a real collapse. This one just shows how "small" Silk Road really was in the btc economy.
Some bitcoiners argued all the time the last years, if Silk Road gets busted, then btc is dead. And now nothing really bad happened.
This is a day to celebrate, the badest argument against btc is now gone.
Cheers!
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Bitcoin is not only drugs
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Absolutely no justification for the downward pointing arrow. Pure propaganda. Might take some time to recover, but more than 50% of the hit was recovered the same day. Until the news, the chart was bullish. Typical knee-jerk reaction to news, already readjusting. Furthermore, the SilkRoad website was bad for Bitcoin. Now that it has been destroyed, the world of Bitcoin is a better place.
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The news is all priced in now. All who needed to sell have reacted and sold.
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The future of BITCOIN is bright and Rosy. Venture Capitalist firms like Andreessen Horowitz are investing MILLIONS in Bitcoins startups. There 's a bitcoin ETF coming by Q1 2014. It will be the currency of choice for online shoppers. Shopping anonymously online is good everyone, no need to put your private info online. I can't believe companies like VISA or MasterCard are not jumping on this yet ....
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@Algokid, Still no ETF lol
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