Cryptocurrencies were lower on Thursday, with Bitcoin falling to a six-week low amid reports that the U.S. Justice Department is looking into whether traders are manipulating the price of Bitcoin and other virtual currencies.
Bitcoin was trading at $7,377.80, falling 6.74% as of 7:59 AM ET (11:59 GMT) on the Bitfinex exchange.
As virtual currencies have increased in popularity among investors, it has lead to further investigations from regulators around the world.
The Justice Department is working with the Commodity Futures Trading Commission, which regulates derivatives tied to Bitcoin, on the probe. It’s just the latest of regulatory pressure that digital currencies have faced in recent months.
The criminal investigation includes looking into tactics such as spoofing and wash trading. Spoofing is when a trader submits orders and then cancels them once prices move, while wash trades are when a trader gives a false impression of market demand.
The news comes just days after the North American Securities Administrators Association (NASSA) unveiled “Operation Cryptosweep” to investigate initial coin offerings and other related digital asset investments.
“Not every ICO or cryptocurrency-related investment is fraudulent, but we urge investors to approach any initial coin offering or cryptocurrency-related investment product with extreme caution,” the NASSA said in a statement.
As governments have increased regulation, digital currencies have fallen in value. The total market cap was at $324 billion at the time of writing, compared to $390 billion on Monday.
Other digital coins were lower, with Ethereum, the world’s second largest cryptocurrency by market cap, down 9.73% to $565.77 on the Bitfinex exchange. Ripple, the third largest virtual currency, decreased 2.44%% to $0.60248 while Litecoin was at $117.47 a slump of 5.86%.
The post by Copy Trading Platform.