BITCOIN SINKS AS U.S. PROBES BINANCE CRYPTOCURRENCY EXCHANGE
Bitcoin slid to a 2-1/2-month low on Thursday after a regulatory probe into crypto exchange Binance added to pressure from Tesla chief Elon Musk's reversing his stance on accepting the digital currency, Kevin Buckland, Gertrude Chavez-dreyfuss and Elizabeth Howcroft reported for Reuters.
Bloomberg reported on Thursday that as part of the Binance inquiry, the US Justice Department and the Internal Revenue Service (IRS) have sought information from individuals with insight into its business. Bitcoin dropped to $45,700, the lowest since March 1, then steadied at $49,312 in Asia morning trade on Friday.
The world's largest cryptocurrency fell 17% on Wednesday following Musk's remarks that Tesla would stop accepting the digital token as payment for its electric cars for environmental reasons.
"Environmental matters are an incredibly sensitive subject right now, and Tesla's move might serve as a wake-up call to businesses and consumers using bitcoin, who hadn't hitherto considered its carbon footprint," Laith Khalaf, an analyst at AJ Bell, said.
Bitcoin remains about 70% higher for the year and is more than 1,000% higher than its 2020 low of $3,850. Binance did not immediately respond to a request for comment. A Binance spokeswoman told Bloomberg that the company doesn't comment on specific inquiries but takes its legal obligations seriously and engages with regulators in a collaborative fashion.
Ethereum, the second-largest cryptocurrency, dropped to a session low of $3,543.62 and last changed hands at $3,656, down about 4%. On Wednesday, ethereum hit a record high of $4,380.64.