Bitcoin update: more pain, no gain; DOJ investigates Tether manipulations

The cryptocurrency market collapse causes panic in the market. The total value of digital assets in circulation is now below $150B, as the market has lost over 4/5 of its value since the beap reached at $815 in January 2018. 

Bitcoin fell as low as $4,224 on Tuesday before recovering slightly towards $4,447 by press time. The largest digital asset is down nearly 15% since this time on Monday with the bearish sentiments gaining traction amid panic selling.

While Mati  Greenspan from eToro notes an increase in long positioning in Bitcoins among broker's traders, obviously, this is not enough to reverse the trend. 

"Clients @etoro have used this crypto price drop to increase their BTC stacks," he tweeted.

The recent developments on the crypto market - namely Bitcoin Cash hard fork and a holy war of two rivaling camps of Bitcoin ABC and Bitcoin SV supporters - stress the chaotic and immature nature of the industry. High volatility and low predictability make digital assets a poor store of value, and a lot of investors have learned it the hard way. 

Moreover, regular reports on crypto scams and hack attacks that result in unrepairable losses erode trust in the industry. Thus, U.S. Justice Department has launched a probe to see whether the rally of the last year was caused by manipulations with USD-backed stable coin Tether. The criminal case on the subject matter was opened a month ago, however, an increased scrutiny from the authorities might have added pressure to the collapsing market. The investigators want to know if the dramatic price increase was triggered by a strong demand or if it was a product of market tricks.

BTC/USD, the daily chart