Bitcoin falls back below $4,000 benchmark as cryptocurrency volatility lingers

The price of bitcoin showed little sign of an upturn this morning after a weekend that saw the cryptocurrency dip below the $4,000 threshold.

Bitcoin's value dipped to $3,930 today, after recovering back above $4,000 late yesterday, when it plunged to $3,474 – its lowest level since September last year, according to Luxembourg crypto-exchange Bitstamp.

Yet the digital currency is still nursing wounds from one of the worst weeks in its history, with values falling 38 per cent since late October, when it was worth more than $6,000.

The world's largest cryptocurrency is now 80 per cent below its high of $19,666 in December 2017.

Questions around Bitcoin’s vulnerability have arisen following increased global pressures to regulate the cryptocurrency, with Financial Conduct Authority (FCA) executive director Christopher Woolard saying recently that the Treasury "will undertake one of the most comprehensive responses globally to the use of cryptoassets for illicit activities". 

Billionaire business magnate Jack Ma warned against speculating on the bitcoin market several months back after saying that the virtual currency could be a potential bubble.

The Chinese investor, who is worth nearly $50bn (£39bn), said: "Blockchain technology could change our world more than people imagine", but adding that “bitcoin however could be a bubble".

The cryptocurrency has long suffered volatility and threats of regulation amid numerous hacks on currency exchanges, costing bitcoin holders millions in lost coins.

The hacking of another cryptocurrency called Bithumb earlier this year spooked the South Korean government, and central banks and governments across the world have started increasing scrutiny.