Bitcoin, the world’s largest cryptocurrency, fell below important levels on Tuesday (25th) and hit a new one-month low, following reports that Binance, the world’s largest cryptocurrency exchange, was involved in wash trading. At the same time, when the Federal Reserve’s interest rate decision is about to be announced, market sentiment is also highly tense, causing some funds to flow into the US dollar and flow out of risky assets.

According to media reports on Monday (24th), Binance CEO Changpeng Zhao stated in a document that the Binance.US entity may have conducted false transactions in the early days of its business, that is, artificially exaggerated the exchange’s trading volume.

A month ago, the U.S. Securities and Exchange Commission (SEC) had sued Binance and Changpeng Zhao, accusing them of violating securities laws and conducting false transactions. Although Changpeng Zhao denied the SEC’s allegations, the lawsuit has dampened investor sentiment towards cryptocurrencies, which have seen interest from retail investors plummet after a series of shock bankruptcies in 2022.

Sentiment in the crypto market soured further after Monday’s report, with major cryptocurrencies like ethereum and ripple also falling sharply.

On the other hand, before the Federal Reserve meeting this week, the market’s risk aversion sentiment generally increased. The Fed is expected to raise interest rates by 25 basis points, however, while the market appears to have priced in this expectation, traders remain nervous about the path of interest rates going forward.

Before the deadline, the Investing.com Cryptocurrency Index showed that within 24 hours, the price of Bitcoin fell 2.17% to $29,135.9. It once fell to $28,890.7 yesterday, a new low since June 21.