The major sell off comes after Lloyds Bank, Virgin Money and USA investment banks banned customers from buying bitcoin and other cryptocurrencies using credit cards.
It comes as virtual coins across the board take a hammering.
Bitcoin initially dropped below $8,000 on Friday during a wild day of trading that saw the cryptocurrency drop by as much as 15%, to a low of $7,700, before jumping and eventually ending the day in positive territory, close to $9,000. Bitcoin cash (BCH), Ripple (XRP) are down 14 percent each, while Ethereum's ether (ETH) token has dropped 13 percent in the last 24 hours.
As the price of Bitcoin is based on speculations and these cryptos will see a drop in price in a similar manner they started their epic bull run previous year.
Ripple isn't the only cryptocurrency to have had an extremely volatile start to the year though. Bitcoin is now at less than half its December peak of over $19,000.
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According to CoinDesk.com, it's down a further 12.49%, hitting a 3-month low of $5,995.58 this morning.
"With U.S. regulators closely scrutinizing one of the world's largest digital exchanges and Facebook Inc banning adverts that promote cryptocurrencies, Bitcoin is in trouble".
On Monday, Financial News, a publication closely affiliated with the People's Bank of China, reported that the central bank will block all platforms related to cryptocurrency trading and the issuance of so-called initial coin offerings (ICOs).
Fears of tightening regulations are also turning sentiment negative: China, India and South Korea have continued to discuss stricter regulations and Facebook last week chose to ban adverts promoting cryptocurrencies. Carstenssaid is not alone, last week India's Finance Minister Arun Jaitley said that the country wants to "eliminate" the use of digital currencies in criminal activities, though India is a minor player in cryptocurrencies and the government apparently has yet to act.