Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Here's What the Winklevoss Twins Are Saying About Bitcoin Now

Photo by: TechCrunch.

The Winklevoss twins may be better known for their role in Facebook -- err, Harvard Connection -- but they're also believed to be the biggest investors in Bitcoin.

And over the last few weeks, they've seen their fortune explode, and dwindle once again. The twins were rumored to own more than 40,000 bitcoins, currently worth about $30 million at an average price of $720 per bitcoin.

Cameron Winklevoss' big prediction
What's the end game for Bitcoin? Cameron Winklevoss thinks it's big -- at least a market cap of $400 billion. That would put each coin at about $40,000 each, or roughly $19,000 once all bitcoins are mined and in circulation.

It's a bold prediction. At $720 per bitcoin, Bitcoin would have to jump 5,500% from a price that is already some 10,000% higher than two years ago.

BTC Keychain

Can Bitcoin reach $40,000 each?
The funny thing about Bitcoin is that any valuation is possible. The market is so thin -- fewer than 100,000 bitcoins change hands daily on an exchange -- that a bevy of large buyers could send the price to astronomical levels.

And, unlike ordinary currencies, bitcoins aren't replaced if lost in an unused account. Thus, once lost, bitcoins cease to exist. This is important. Recently, one man threw away a hard drive that housed bitcoins worth some $7.5 million. Those coins are now gone, never to circulate again.

Surely, those aren't the only bitcoins that have been lost in the so-called "blockchain." In the early days of Bitcoin, websites that served as bitcoin faucets gave away free coins to stimulate its introduction. Many bitcoins, and fractions of a bitcoin, were given to new users, many of whom likely never did anything with the online currency.

Why the Winklevii are bullish on Bitcoin
Few would ever predict that any asset -- tangible, or intangible like Bitcoin -- would rise another 5,500% after a massive, 10,000% gain. But, Cameron Winklevoss believes Bitcoin is more than just a novelty; in his view, it's an alternative to fiat currencies like the U.S. dollar.

Is Bitcoin a true currency? Kind of. On Black Friday, Bitpay, a Bitcoin payment processor, reported that 6,296 transactions took place. Bitpay now has as many as 12,000 merchants, up from just 1,000 merchants one year ago.

So, while Bitcoin is enabling legitimate online commerce, it still has a long way to go to become a true online currency, and justify a valuation anywhere near $40,000 per bitcoin. Is this just the start to a meteoric rise in Bitcoin, or a bubble waiting to burst? Time will tell. 

The one stock to own in 2014
Like Bitcoin, the stock market stormed out to huge gains across 2013, leaving investors on the sidelines burned. However, opportunistic investors can still find huge winners. The Motley Fool's chief investment officer has just hand-picked one such opportunity in our new report: "The Motley Fool's Top Stock for 2014." To find out which stock it is and read our in-depth report, simply click here. It's free!

Read/Post Comments (7) | Recommend This Article (7)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 22, 2013, at 1:42 PM, cdkeli wrote:

    These two spoiled wannabees again?! Always a day late and a dollar short,,,go figure.

  • Report this Comment On December 22, 2013, at 2:51 PM, quickdraw12 wrote:

    I can't wait long enough for the new movie to come out "The Bitcoin Miner's Daughter"

  • Report this Comment On December 23, 2013, at 12:46 PM, TerrifiedCitizen wrote:

    For Pete's sake, if you don't use bitcoin or another alternative to the banking industry, then at the very least return to a cash economy.

  • Report this Comment On December 23, 2013, at 4:22 PM, ockhamsrazor wrote:

    it's this simple: if you're not a seller at this price, make a coherent argument as to why bitcoin has a *specific* higher value at which you WOULD be a seller.

    nobody has tried, and it can't be done, because bitcoin has no intrinsic value. it's greed and stupidity all the way down. by no means do i expect it to end here, but there is no, zero, reason why it couldn't.

  • Report this Comment On December 23, 2013, at 5:36 PM, stevenyaniz wrote:

    Here's everything wrong with bitcoins in a nutshell:

    1- Easiest way to be robbed of all your money is investing in Bitcoins, just ask Sheep MarketPlace, Tor Market Place, Atlantis MarketPlace and quite a few of the Bitcoin exchanges/ banks which have disappeared after HUGE heists of millions in bitcoins.

    2- No one is buying! You could scoop them up for $100 a piece and wait for days or weeks to find a buyer, and even then you have to beware of them scamming or robbing you of everything.

    3- Marketplaces keep closing, exchanges keep shutting down and in reality there is no way to determine what they are worth from one day to the next. When the "Twins" first started talking about Bitcoins they shot through the roof and climbed to 1200 per coin. Overnight they plummeted to under 500 and are now looking kind of stable-if only for the moment-at 600 to 700 each. Too expensive to buy and invest in without risking a huge loss.

    4- This currency was made for hackers, by hackers and with hacking or other blackmarket purposes in mind. China is already shutting down access since they can't have any oversight or control. The US has not even started taking the currency seriously. But most important is the fact that their inherent value is based on their being a limited amount, with stories of new "treasure troves" of coins appearing on the net daily.

    If you're lucky and get to buy one for a cheap price or get to invest when the market slumps, maybe you'll have a chance at some money. Personally I paid 112 for my first coins and sold at 256, while the market was asking for 308 per coin. The coins I didn't sell I used online at various marketplaces and enjoyed the benefits of non-traceable funds and the merchandise I received in return. At 600 to 700 hundred dollars I and others like me can't enjoy the benefit anymore which basically shuts down the premise of easy use and availability. My suggestion is stay away if you're not worth millions and can't afford the crash. And the crash is coming and soon, the NSA, FBI and DEA are all monitoring purchases and reporting excess money transfers as laundering or attempts at tax evasion. Oh I forgot, did I mention you need a bank account to buy them...Yeah, real anonymous Winklevoss

  • Report this Comment On December 24, 2013, at 10:47 AM, kdi wrote:

    Ask anyone who got screwed out of money in online casinos when the USA banks closed ranks strangling the income streams too and fro with that mess. The first bank too pull the deposit then hold and wait like they do with checks will start a landslide. Hint , exchange bitcoins for cash and the bitcoins go in an escrow bank wallet till funds clear. So, bitcoins go up, bank keeps the difference, they go down the bank loses nothing. If there is a money stream out there TATB will find a way to stick a blood funnel in it.

  • Report this Comment On December 25, 2013, at 3:43 PM, thatguy111 wrote:

    Here to do my best to respectfully debunk all of the points that stevenyaniz pointed out.

    1. That would be investing in just ONE specific marketplace. Atlantis saw a vulnerability so they allowed users to withdraw for a short time and left. You're not considering that there may be another side to the story. You're also not considering that you can make a private wallet on your computer.

    2. I would refute that, but it's not really clear enough to do so.

    3. The marketplaces and exchanges keep being shut down due to their allowing of illegal uses. There are legitimate uses for bitcoin that I feel haven't been fully realized.

    4. It wasn't made for hackers, it wasn't made by a hacker. The lead developer behind bitcoin left a long time ago, after having used a pseudonym. His identity hasn't really been made public, but hackers control a large portion of bitcoins because they were the first to hear about it due to bitcoin's technical nature.

    You can also buy bitcoins in cash. There are websites that allow users to do so with relative ease. If you do this in a different state in a relatively safe disguise, it's pretty anonymous. There are also laundry services for bitcoin, so you can still anonymize all of it (even though if you buy bitcoins from an exchange such as Mt Gox, they are already washed). As for your comment on availability, you can mine bitcoins yourself.0

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2773107, ~/Articles/ArticleHandler.aspx, 9/30/2016 1:23:36 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 4 hours ago Sponsored by:
DOW 18,143.45 -195.79 -1.07%
S&P 500 2,151.13 -20.24 -0.93%
NASD 5,269.15 -49.39 -0.93%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes