This latest rocky patch for bitcoin is thought to have been triggered by rumours that the Tether cryptocurrency has been artificially raising its value.
Owned by trading company Bitfinex, Tether has been criticised by financial bloggers who claim it has been plucked from thin air to boost the value of bitcoin.
Nicholas Weaver, a professor from UC Berkeley’s International Computer Science Institute has warned that a “bloodbath” would ensue if the claims turn out to be true