The Silk Road

  Bitcoin has huge news yesterday.   Perhaps the biggest news since I've been watching it around April.

The Silk Road has been shut down.

For those that dont know, the Silk Road was an illicit drug market.    Users could covert their fiat dollars to Bitcoin, go to "ebay" style drug website, select their products, pay in bitcoin and receive their goods in the mail.  Yes... it was mail order drugs.... the real kind.

The website was suppose to be "un-shutdownable" due to bitcoins "un-stoppableness" and TOR's "privacy"

Regardless, the FBI found the guy running it because he had made a couple HUGE mistakes, neither of which had anything to do with Bitcoin.*  There was nothing wrongs with Bitcoins security.

The reaction of the bitcoin market was a drop in value of around 40% in the short term.  Today its only down about 10%.

This is both good and bad for bitcoin... here is why.

The Bad:
   The Silk Road was opened in 2011, and was perhaps the first proof on concept of the power of bitcoin.   Users of Bitcoin can spend them wherever they damn well please without government interference.    In two years, the silk road had handled about 9.5 million bitcoin.   There are only 11.7 bitcoin available right now, so about 80% of all bitcoins have travelled through the silk road.   If you have 10 bitcoin, 8 of them on average have travelled the silk road.
   Two years, silk road may be been 90% of the utility of Bitcoin.   Most users and holders of Bitcoin probably only used them for the Silk Road.... this has lead to Bitcoins reputation of being used to buy drugs.   Just refer to any CNN article or any main stream media article and it will reference using bitcoin to buy drugs, because in 2011 that was all it was really good for.
  Fast forward to late 2013, and perhaps only 10% of bitcoin is used to buy drugs, but we still have this bad reputation... which leads to the good.

The Good:
   The reputation of Bitcoin was improved yesterday with the shut down of the Silkroad.    The main stream media can now dis-connect BTC and the Silkroad because the Silkroad no longer exists.  This is good in the long term.  Yes you can still buy drugs with bitcoin on other markets, but they are small and not well known.
   Why would Amazon, Paypal, or Google want to be associated with a currency that "was" only used to buy drugs?   Thats just bad business.  
  I believe that with Silk Road out of the way we now have fewer barriers to mainstream adoption.
  In the short term, yes the value is down, but it will only take one company to take bitcoin to drive its price to the moon.    It almost seams as though bitcoin was designed for Amazon.com or Paypal.

The Neutral:
    I 110% guarantee you that "The Polyester Road" began being designed yesterday.   The profit margins are too huge to assume that there will be no black market.  It will come back, somebody just needs the time to design it.   This person will also not be as stupid as the guy that ran the Silk Road.