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Bitcoin extends sell-off after U.S. agency warns of risks

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Investing.com -

Investing.com - Bitcoin prices fell sharply on Tuesday to hit a two-week low after the U.S. Consumer Finance Protection Bureau issued its first consumer advisory on virtual currencies.

BTC/USD dropped 1.94%, or $11.20, on Slovenia-based BitStamp to trade at $564.79 during U.S. morning hours. Prices fell to a daily low of $561.90 earlier, the weakest level since July 31.

Bitcoin prices were likely to find support at $555.90, the low from July 31, and resistance at $597.00, the high from August 10.

Elsewhere, the price of a Bitcoin on Bulgaria-based BTC-e slumped 1.24%, or $7.12, to trade at $566.91. Prices hit $560.94 earlier, the lowest since July 31.

Meanwhile, euro-denominated Bitcoin prices (BTC/EUR) shed 0.2%, or €0.87, to trade at €428.31 on U.S.-based Kraken Exchange.

According to the CoinDesk Bitcoin Price Index, which averages prices from the major exchanges, prices of the crypto-currency declined 1.27% to trade at $566.03.

Demand for Bitcoins was dampened on Monday after the Consumer Financial Protection Bureau issued a lengthy set of risks that virtual currencies pose to consumers.

In issuing an advisory warning, the agency noted that the currencies are not backed by the government, have volatile exchanges rates and are targeted by hackers and scammers. And unlike bank accounts, Bitcoin-based deposits are not federally insured.

"Consumers are stepping into the Wild West," CFPB Director Richard Cordray said in a statement.

Bitcoin is digital cash and is not backed by a government or central bank to regulate or issue it. It can be used to purchase goods and services from stores and online retailers.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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