Bitcoin prices have cratered recently as a series of recent events, including a trading halt at one major exchange, has left some investors rattled.
The price of a single coin shed more than $100 dollars in the span of five hours late Wednesday, falling from $669 to a low of $554 shortly before midnight Eastern Time, according to data from CryptoCompare.
Problems began Monday when Bitfinex, the largest U.S.-based cryptocurrency exchange based on trading volume, began experiencing issues with its platform, leading it to suspend trading. After briefly bringing trading back on line, the exchange was forced to halt trading a second time on Tuesday, citing similar issues.
In a tweet published Monday, the company emphasized that the outage was due to an infrastructure issue, and that it had not affected security at the exchange, or customers’ funds.
Trading has been paused while we investigate an infrastructure issue. The issue does not involve funds or system security.
— Bitfinex.com (@bitfinex) June 20, 2016
Still, the glitches for some recalled memories of Mt. Gox, said Charles Hayter, the founder of CryptoCompare. Mt. Gox, formerly one of the world’s largest exchanges, initially blamed technical issues when it abruptly halted bitcoin withdrawals in February 2014.
The exchange was eventually forced to declare bankruptcy after it admitted that hackers had stolen millions of dollars’ worth of customers’ bitcoins.
“Those wounds are still raw,” said Hayter.
Last week, a similar selloff occurred in bitcoin rival Ethereum after a theft of more than $50 million in its ether tokens from an organization, referred to as the DAO. Ether tokens boast the second-largest market capitalization among the world’s cryptocurrencies behind bitcoin.
“The events over the DAO hack might have spooked some people from ether to Bitcoin helping with the rise in price and now that ether is recovering a little that movement is reversing the action,” said Tone Vays, the head of research at Brave New Coin.
While the Bitfinex outage was the initial catalyst for the selloff, other factors—like the looming Brexit vote in the U. K.—were affecting the price, Hayter said.
Recent polls showing support tilting toward a vote to remain in the European Union in Thursday’s referendum helped to diminish bitcoin’s appeal, Hayter said. Trading in the cryptocurrency has been closely correlated to gold
in recent weeks, a sign that bitcoin is behaving like a haven asset.
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Bitcoin’s recent run-up also might have left prices overextended and primed for a selloff, some said.
The value of a single coin peaked above $780 on June 18—its strongest level since Feb. 3, 2014—before the selloff began.
“The price rise was too fast. It just needed a break,” Vays said.