Bitcoin Prices Drop Below $10,000 As Bitfinex Investigation Heats Up

Crime, Investing, News | February 1, 2018 By:

Bitcoin has plunged below the $10,000 level, sitting in the mid-$9,000 range this morning. Investors are worried that the floor may be much further below, and news emerging on possible price manipulation by one prominent exchange is fueling anxiety.

Bloomberg reported earlier that the Commodity Futures Trading Commission has issued a subpoena to Bitfinex, one of the world’s largest digital currency exchanges. The New York Times picked up the story today, throwing gasoline on the simmering story, which had gone unnoticed since December.

The nature of the CFTC investigation is not known, but likely involves its digital currency, Tether. Every Tether is tied to the US dollar, with one dollar equaling one token. Some investors have raised concerns over the fact that hundreds of millions of dollars in Tether has been created over the last few months, coinciding with digital currency prices dropping. The Tether is then used to make big buys in bitcoin and other tokens, thereby supporting the currencies.

Bitfinex’s murky business is adding to concerns that Tether has been used as a tool to keep digital currence prices aloft. Bitfinex has not commented on the investigation or the allegations. It previously hired the American accounting firm Friedman to audit its records, but last week announced it was cutting ties with them, citing impatience with the slow progress on the audit.

Bitcoin market highlights for the 24 hours ending February 1, 2018 at 1:00 pm U.S. Eastern Time

The highest price seen was $10,312.40 on the Binance exchange at 8:36 pm yesterday. Binance saw $237,838,000 of bitcoin change hands.

The lowest price seen was $8,830.00 on GDAX’s exchange at 11:42 am today. GDAX’s 24 hour volume was $216,907,000.

The average price on the surveyed exchanges, as weighed by volume, was $9,834.28.

Volatility was a bit above average, with the BlockTribune Volatility Index coming in at 52.6. A higher number indicates greater price volatility with 50 describing an average day.

These statistics were consolidated from 12 different exchanges. It includes only BTC/USD trades and only on those exchanges that had at least 1% of the total volume of BTC/USD trades during the measurement period.