The world’s number one digital asset bounced back to just above $40,000 as of 8am GMT, but was still trading 11% lower compared to the previous day.
The plunge reportedly comes after Chinese authorities banned financial institutions and payment firms from providing services connected to cryptocurrency transactions.
The restrictive measures, coupled with a warning to investors against speculative crypto trading, reportedly exacerbated the selling triggered by Elon Musk’s reversal on Tesla accepting bitcoin as payment. The announcement followed several tweets raising uncertainty over whether the electric automaker had sold its $1.5 billion holdings in the cryptocurrency.
Other cryptocurrencies also saw a massive drop in value with ether dropping nearly 15% to below $3,000. Dogecoin, a meme-based cryptocurrency that has been pushed by Musk’s tweets, declined by more than 16% to below $0.42, according to data tracked by Coindesk.
The latest selloff has wiped around $279.65 billion off the entire value of the cryptocurrency market in the past 24 hours.
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