Bitcoin dropped below the $29,000 level, but then rebounded modestly, with its price settling near $29,100, down more than 2 per cent
Bitcoin slid more than 2 per cent after news the US Department of Justice (DOJ) is reportedly considering bringing fraud charges against crypto currency exchange Binance.
Bitcoin (BTC-USD) dropped below the $29,000 level, but then rebounded modestly, with its price settling near $29,100, down more than 2 per cent.
The Department of Justice is hesitating over the fraud charges because of concerns over the adverse effect on the wider crypto industry, as per Semafor.
Federal prosecutors are concerned charges against Binance could cause a run on the platform. They fear a repeat of the FTX collapse in November last year when an indictment led to a bank run that resulted in many retail investors losing their money.
US prosecutors are weighing other options, like fines and deferred or non-prosecution agreements, as per Semafor.
Binance and its founder, Changpeng Zhao, have already been charged by the US SEC.
In June, the financial regulator accused Binance of mishandling customer funds and lying to regulators and investors about its operations.
This comes as the price of bitcoin sees some stability as trading volumes stay low.
Bitcoin is hovering above the $29,000 mark as traders await any updates with a US spot Bitcoin ETF, Edward Moya, senior market analyst at Oanda, stated in a note.
He added that fresh money has not yet been coming into the cryptoverse so range trading might remain for some more time.
Confidence in bitcoin and the crypto currency market was also impacted by a hack on the Curve Finance decentralised exchange on Sunday which led to a loss of nearly $70m, as per Chainalysis.
The attackers exploited a weakness in Vyper, a Python-based programming language for Ethereum (ETH-USD) smart contracts utilised by Curve and other DeFi platforms.
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