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Bitcoin suffers its biggest plunge in a month as traders fear tighter regulations

Akin Oyedele
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  • Bitcoin fell Wednesday by more than 8%, its largest one-day drop in a month.
  • The world's largest cryptocurrency slumped following a report by the Commodity Futures Trading Commission that raised fears about future regulations.
  • Bitcoin recently sold off on reports of tighter regulation in China, but quickly rebounded to an all-time high.

Bitcoin's price fell by the most in a month Wednesday after US regulators signalled that the cryptocurrency may come under more scrutiny. Other large cryptocurrencies including ethereum and bitcoin cash were also sharply lower.

A primer by the Commodity Futures Trading Commission released Tuesday said virtual tokens used in Initial Coin Offerings, the process of launching digital currencies, were characterised as securities, which could bring them under its regulatory scope.

"There is no inconsistency between the SEC's analysis and the CFTC's determination that virtual currencies are commodities and that virtual tokens may be commodities or derivatives contracts depending on the particular facts and circumstances," the report said.

At 10:21 a.m. ET, bitcoin is down by 8.5% to 5,125 per dollar.

The volatile cryptocurrency has previously fallen on reports that China was closing down local exchanges, although it quickly rebounded to nearly 6,000 per dollar.

Get the latest Bitcoin price here.