The Man Who Won the Bitcoin Auction Would Also Make Silicon Valley Its Own State

A blog about business and economics.
July 2 2014 5:09 PM

The Man Who Won the Bitcoin Auction Would Also Make Silicon Valley Its Own State

rtxkyqd
Tim Draper, venture capitalist and new owner of nearly 30,000 bitcoins.

Photo by Brendan McDermid/Reuters

Remember when, last October, the criminal known as Dread Pirate Roberts was arrested and his market for illegal goods and services, Silk Road, shut down? And then U.S. law enforcement wound up with nearly 30,000 bitcoins worth tens of millions of dollars? Well, that stash of virtual currency was auctioned off last week and it is now all in the hands of one venture capitalist.

Tim Draper, the co-founder of investment firm Draper Fisher Jurvetson and father of prominent bitcoin investor Adam Draper, was the single winning bidder of bitcoins at a U.S. Marshals Service auction held on Friday. It's unknown just how much he paid to win the cache, though Bloomberg notes that the bitcoins themselves were worth about $19 million on the day they sold. More than 63 bids were submitted from 45 bidders during the 12-hour auction, according to the government.

Advertisement

Draper plans to partner with Vaurum, a bitcoin exchange that was incubated last summer by his son's startup accelerator Boost, to provide bitcoin liquidity in emerging markets. "Bitcoin frees people from trying to operate in a modern market economy with weak currencies," Draper said in a statement published by Vaurum. "We want to enable people to hold and trade bitcoin to secure themselves against weakening currencies."

As is no longer surprising with bitcoin enthusiasts, Draper also has a libertarian streak. In addition to his successful tech investments, he is also known for the radical "Six Californias" proposal. The goal of the plan is to divide the state of California into six separate states—including one just for Silicon Valley—with their own local governments. In May, Draper advocated for the six-way breakup by railing against what he viewed as the tyrannical effects of centralized government: "We’ve gone from, in effect, a very free country to one where it’s moving toward, I guess it’s slavery," he said. "When you work for your government, when your government forces you to do something, it’s slavery. We need to take it back.” Draper later expressed his regret for the slavery analogy.

Alison Griswold is a Slate staff writer covering business and economics.

TODAY IN SLATE

War Stories

The Right Target

Why Obama’s airstrikes against ISIS may be more effective than people expect.

The One National Holiday Republicans Hope You Forget

It’s Legal for Obama to Bomb Syria Because He Says It Is

I Stand With Emma Watson on Women’s Rights

Even though I know I’m going to get flak for it.

Should You Recline Your Seat? Two Economists Weigh In.

Doublex

It Is Very, Very Stupid to Compare Hope Solo to Ray Rice

Or, why it is very, very stupid to compare Hope Solo to Ray Rice.

Building a Better Workplace

In Defense of HR

Startups and small businesses shouldn’t skip over a human resources department.

Why Is This Mother in Prison for Helping Her Daughter Get an Abortion?

Politico Wonders Why Gabby Giffords Is So “Ruthless” on Gun Control

Behold
Sept. 23 2014 4:45 PM An Up-Close Look at the U.S.–Mexico Border
  News & Politics
Foreigners
Sept. 23 2014 6:40 PM Coalition of the Presentable Don’t believe the official version. Meet America’s real allies in the fight against ISIS.
  Business
Moneybox
Sept. 23 2014 2:08 PM Home Depot’s Former Lead Security Engineer Had a Legacy of Sabotage
  Life
Outward
Sept. 23 2014 1:57 PM Would a Second Sarkozy Presidency End Marriage Equality in France?
  Double X
The XX Factor
Sept. 23 2014 2:32 PM Politico Asks: Why Is Gabby Giffords So “Ruthless” on Gun Control?
  Slate Plus
Political Gabfest
Sept. 23 2014 3:04 PM Chicago Gabfest How to get your tickets before anyone else.
  Arts
Brow Beat
Sept. 23 2014 8:38 PM “No One in This World” Is One of Kutiman’s Best, Most Impressive Songs
  Technology
Future Tense
Sept. 23 2014 5:36 PM This Climate Change Poem Moved World Leaders to Tears Today
  Health & Science
Science
Sept. 23 2014 4:33 PM Who Deserves Those 4 Inches of Airplane Seat Space? An investigation into the economics of reclining.
  Sports
Sports Nut
Sept. 23 2014 7:27 PM You’re Fired, Roger Goodell If the commissioner gets the ax, the NFL would still need a better justice system. What would that look like?