Bitcoin has sunk a further 12% on Wednesday to below $10,000, halving in value from its peak price when it skyrocketed last year.
This is its largest slump since early December, according to CoinDesk's Bitcoin Price Index (BPI). It said that as it stands, the collective market capitalisation of all cryptocurrencies has dropped more than $200bn since yesterday.
Bitcoin touched a peak of almost $20,000 in December. Fears regulators could clamp down on the volatile cryptocurrency have created a raft of large sell-offs.
Charles Hayter, founder of Cryptocompare, said: "There is a lot of panic in the market. People are selling to try and get the hell out of there. You have more regulatory uncertainty...and because of these falls you have these other outfalls."
Other digital currencies such as Ethereum and Ripple have faced similar losses. According to CoinMarketCap data, ethereum was trading more than 23% lower at $824.10 a coin after sinking beneath $1,000 on Tuesday. Ripple fell 31% to about 95 cents.