DOJ Opens Probe into Possible Crypto Price Manipulation

Justice and Bitcoin

 

 

The United States Department of Justice has launched a criminal probe to determine whether digital currency prices have been manipulated by crypto traders, according to reports from Bloomberg and other media outlets. The probe reportedly involves an investigation into possible spoofing and wash trading, both of which are considered illicit trading activities that could influence trading prices.

Citing “four people familiar with the matter,” Bloomberg reported that the prosecutors involved in the investigation are collaborating with the Commodity Futures Trading Commission. Investigators have been concerned by volatility in the crypto markets and the absence of any strong regulations that might inhibit illegal manipulation.

Digital currency prices fell on Thursday, as the markets appeared to react to the news. However, some welcomed the news as a way to help eliminate bad actors and add legitimacy to an industry that has often struggled with public perception.

Fundstrat’s Tom Lee called the probe a sign that “adult supervision” was on the way, while Gemini exchange president Cameron Winklevoss suggested that his company would “welcome any inquiry that serves to foster rules-based marketplaces and deter bad actors.”

In an interview with Bloomberg, investor Mike Novogratz praised the DOJ probe:

“Weeding out the bad actors is a good thing, not a bad thing for the health of the market. Plenty of exchanges have these inflated volume numbers to create some sense of excitement around coins.”

 

Author: Ken Chase

Freelance writer whose interests include topics ranging from technology and finance to politics, fitness, and all things canine. Aspiring polymath, semi-professional skeptic, and passionate advocate for the judicious use of the Oxford comma.

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