Bitcoin price again plummets, altcoins sell off amid Binance being targeted

The crypto community is buzzing about the possibility that Binance may be under investigation by the US Department of Justice and the IRS. This news triggered a sell-off that sent the Bitcoin price down to $47,000 (again).

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BTC/USD 4-hour chart | Source: TradingView

Bitcoin price plummets once again, altcoins sell-off amid Binance being targeted

As the crypto market still hasn’t recovered from the news that Tesla stopped accepting Bitcoin payments, the fact that Binance has been targeted by US authorities has continued to prolong the decline that began on May 12 and saw the market’s largest coin drop to lows of $46,000 on several exchanges for the 2nd time in 24 hours.

Initially, Tesla’s May 12 announcement that the company would stop accepting Bitcoin as a payment method due to environmental concerns, along with negative factors from technical analysis, pushed up the price of BTC down to $47,000.

The catalyst for the second price drop stemmed from a Bloomberg Tax report claiming that the US Department of Justice and Internal Revenue Service were investigating Binance Holdings Ltd. for allegations of illegal activity.

While the investigation is still unconfirmed at this time, when the news was released, the Bitcoin price quickly dropped over $3,000, hit a low of $47,300, and recovered quickly to the $50,000 level during the period’s current point.

From a technical analysis point of view, with a bearish head and shoulders pattern now confirmed and stopping the 61.8% Fibonacci retracement level at $42,600, traders can expect BTC price to retest the $40,000 level. do support. Below this level, there is the 200-day moving average at $39,000 and in the worst case, $35,000 as the target of the head and shoulders pattern.

Bitcoin’s price may be heading back to multi-month lows, but a whirlwind on Twitter shows that most traders view the current short-term drop as a “promotional”, including Michael Saylor, who on May 13 tweeted that MicroStrategy bought 271 more BTC at an average price of $55,387.

This is not the first time Binance has been accused of illegal activities by authorities and regulators in the US. On March 12, Coin68 reported that Binance was under investigation for lax KYC and Anti-Money Laundering processes, an allegation that Binance CEO Changpeng Zhao said was unfounded.

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