The U.S. Department of Justice has launched a criminal probe into the trading of bitcoin and other digital currencies, according to Bloomberg.
The investigation focuses on illegal practices that traders can use to manipulate prices, such as spoofing, which floods the market with fake orders that trick other traders into buying or selling, Bloomberg reports citing unnamed sources.
Federal prosecutors are working with financial regulator Commodity Futures Trading Commission, which oversees bitcoin connected derivatives.
Bloomberg says authorities worry that virtual currencies such as bitcoin are susceptible to fraud for a number of reasons, including wild price swings.
Bitcoin was down 3 percent to $7,409 following the Bloomberg report of the probe Thursday.
