The U.S. Justice Department is working with the Commodity Futures Trading Commission to investigate possible price manipulation of bitcoin (BTC) and other cryptocurrencies, Bloomberg reported Thursday.
Authorities worry that virtual currencies are susceptible to fraud because, among other reasons, wild price swings could make it easy to push valuations around and there are no regulations similar to those that apply to stocks and other assets, said Bloomberg.
The criminal probe is focusing on illegal practices including possible flooding of the market with fake orders to trick other traders into buying or selling, according to Bloomberg, citing people familiar with the matter. Such practices can influence prices. Neither the DOJ or the CFTC would comment on the report. Read more here.