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An unconfirmed report that the US Treasury Department plans to prosecute several financial institutions for money laundering using cryptocurrencies has caused a sharp decline in the cryptocurrency market.
Bitcoin dropped to $ 51,000 in a matter of hours, with the highest altcoins recording even steeper losses. Ethereum fell shortly below $ 2,000 and the BNB below $ 450.
The tweet, which allegedly triggered a fall on cryptocurrencies, was published by a dubious Twitter account called FXHedge.
U.S. TREASURY TO CHARGE SEVERAL FINANCIAL INSTITUTIONS FOR MONEY LAUNDERING USING CRYPTOCURRENCIES -SOURCES
— FXHedge (@Fxhedgers) April 18, 2021
Tweet managed to erase $ 288 billion from the cryptocurrency market within 54 minutes of being published on social media. At the time of writing, he has over 5,200 likes despite citing anonymous sources and disabling comments.
Jake Chervinsky, chief attorney at Compound Finance, writes that he does not consider the tweet to be credible because money laundering falls within the remit of the US Department of Justice. He also writes that it would be “unusual” to prosecute several financial institutions at once.
It should be noted that FXHedge already has a history of false claims, which means that its content must be taken with a grain of salt.
The fact that an unconfirmed tweet can erase hundreds of billions from the crypt market has revealed the fragility of this market, which is still very sensitive to similar rumors.
This is further evidence that cryptocurrencies as an investment are still very volatile.
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