BITCOIN PRICE CRASH CAUSED BY PANIC SELLERS AND MANIPULATION

Low liquidity is indeed one of the cryptocurrency market’s biggest problems, as it allows as little as one account to dramatically manipulate the price of bitcoin, or other cryptocurrencies, by throwing around 1000 BTC, sparking a wave of panic selling from individuals who honestly believe there has been some fundamental change in the cryptocurrency itself.
Cryptocurrencies like bitcoin have grown in popularity in large part because they can be bought and sold without a government or other third party overseeing everything. But there’s a flipside: Unlike in markets for other assets such as stocks or bonds, it makes it much harder to uncover price manipulation and fraud.

But that’s what the Justice Department likely intends to do. In May, it opened a criminal investigation to examine whether there has been price manipulation in the cryptocurrency markets. While it wasn’t clear what time period investigators are looking at, it’s likely that they’re focusing on the sharp rise and fall that occurred in late 2017 and early 2018.