There is so much irrational fear and baseless speculation here.
1) Seized assets are sold at government auctions open to the public. They will be announced well in advance of the auction. It won't be a 30 second warning then it hits the auction block.
2) Regarding #1, The central bank, the CIA, a government official, wells fargo
3) Seized assets often have reserves set at auction, reserves set by the federal agency responsible.
4) Seized assets are often broken into smaller lots. Why? Faster selling at prices closes to market value. The auction portion is outsourced to auction companies who have incentive to ensure property is auctioned for the highest value possible because they get paid on some transaction fee %
5) Regarding 3+4 above, the likelihood of all the bitcoins selling for far below fair market value is extremely low. The parties involved, do seized asset auctions for a living and know how to get the most for an item at auction. They will treat this as any other valuable item with a market and base their reserve prices and auction style decisions on that market.
6) This will effect the price regardless of who buys them and what they do with them afterward.(hold or dump) minimally and only in a very short term time frame. Yes even if they are immediately all dumped on open market.
7) This liquidation of assets won't happen any time soon. The assets will be researched and the market value determined. This will drive the decision to split it into lots or keep it whole. Then They have to give public notice of the auction. This process could realistically(considering how slow the government is) take months into years!
8) Everyone chill the fuck out!
See the original article here: http://www.reddit.com/r/Bitcoin/comments/1vg7am/can_we_have_some_common_sense_here_regarding_fed/