Bitcoin’s Price Swings Have Been Especially Crazy in the Last 24 Hours. Here’s Why

The last day’s fluctuations in the bitcoin price have been pretty crazy, even by the cryptocurrency’s typically volatile standards.

Having climbed more than $ 3,000 in a week to clear the $ 11,000 mark on Wednesday, reaching a high of $ 11,377, bitcoin suddenly plunged 20% to around $ 9,290 (prices varied on different exchanges). To spell out precisely how volatile we’re talking here, it lost $ 1,000 in value in the space of around 10 minutes.

And then it recovered somewhat. At the time of writing on Thursday morning, the price of one bitcoin is bobbing up and down around $ 10,000.

The fall seems to have coincided with outages and interruptions on major cryptocurrency exchanges, which may well be a function of the spike in trading volume—according to CoinMarketCap, the volume in the last 24 hours has been a stunning $ 10.5 billion.

According to Coindesk, Coinbase’s GDAX exchange had a full-blown outage and there were disruptions on Bitstamp and Bitfinex, too.

So, why the massive ups and downs? Bitcoin’s value was likely goosed by the reports that Nasdaq (ndaq) and Cantor Fitzgerald wanted to follow CME’s lead in trading bitcoin futures—yet another sign that more and more institutional money is pouring into the virtual currency.

On the flipside, though, the IRS just got a court to back it up in its demand that Coinbase hand over details of thousands of accounts that have been high-volume bitcoin traders, so it can collect back-taxes for unreported transactions.

It’s quite possible that investors simply saw bitcoin’s massive rise and decided to cash out.

Vitor Constancio, the vice-president of the European Central Bank, warned on Wednesday that people should think twice about buying into bitcoin at this stage in the game.

“It’s a very particular asset, it’s a speculative asset by definition looking to the developments in its price. Investors are taking that risk of buying at such high prices,” he told CNBC.