Date
15 August 2018
US federal prosecutors are said to be working with the Commodity Futures Trading Commission in a criminal probe into suspected illicit trading practices in bitcoin and other digital currencies. Photo: Reuters
US federal prosecutors are said to be working with the Commodity Futures Trading Commission in a criminal probe into suspected illicit trading practices in bitcoin and other digital currencies. Photo: Reuters

US launches probe into bitcoin price manipulation: report

The US Justice Department has opened a criminal probe into whether traders are manipulating the price of bitcoin and other digital currencies, Bloomberg reports, citing sources familiar with the matter.

The investigation is centered on illegal practices that can influence prices — such as spoofing, or flooding the market with fake orders to trick other traders into buying or selling, the report said.

Federal prosecutors are working with the Commodity Futures Trading Commission in the investigation, according to the report.

The illicit tactics that the Justice Department is looking into include wash trading, where a person trades with himself to give a false impression of market demand that lures others to dive in, sources told Bloomberg.

Coins that prosecutors are examining include bitcoin and ether.

The investigation, which is said to be in its early stages, marks the latest effort by US authorities to crack down on an industry that critics say is rife with misconduct.

Among other initiatives, the Securities and Exchange Commission has opened several investigations into initial coin offerings due to suspicions that many such deals are scams.

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RC

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