The wild price swings in the cryptocurrency markets is being investigated by the U.S. Justice Department over concerns that traders are manipulating prices. Potential issues include collusion between actors to generate price volatility and also that individual users are operating multiple accounts to trade with themselves and generate false demand in the market. Prior research by cryptocurrency advocates has also revealed users placing fake orders that never get filled, some exceeding $1 million dollars in value.
In December of 2017, OODA Expert Matt Devost noted that “the current run-up in BTC prices could be the result of manipulation by criminals or sanctioned individuals looking for a viable money movement platform for laundering and high value transactions.”
According to Bloomberg “The Justice Department has opened a criminal probe into whether traders are manipulating the price of Bitcoin and other digital currencies, dramatically ratcheting up U.S. scrutiny of red-hot markets that critics say are rife with misconduct, according to four people familiar with the matter.
The investigation is focused 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…”
Source: U.S. Launches Criminal Probe into Bitcoin Price Manipulation – Bloomberg
