Victor Argonov, EXANTE’s senior analyst, told Express.co.uk the recent price woes for Bitcoin are not as related to politics and recent events as first thought.

When the price of the digital currency fell to lows around $28,800 (£20,941.20) in June, it was partially blamed on China’s crackdown onto cryptocurrency mining and usage. 

But Mr Argonov said: “An interesting feature of the recent collapse is its relatively weak connection with political events. 

“News from China has ceased to particularly affect the market: investors have already come to terms with the fact that in the Middle Kingdom things are not very good with cryptocurrencies. 

“The importance of the EU initiative to ban anonymous BTC transactions should not be overestimated either: according to lawyers, even if it is approved, it will take years before the relevant laws are passed. 

“During this time, a lot can change. Other factors in the BTC crash were purely economic: the US stock market crash on Monday and the Grayscale Bitcoin Trust unblocking 16,000 BTC on Sunday.“

“By and large, the above factors were just excuses. Bouncing back in late June, BTC has had a negative trend since early July, and it was only a matter of time (and depth) before a new crash. 

“However, it is possible that this collapse was the last in the series. It is symbolic that the “culprit” of the May collapse, Elon Musk, spoke out in support of BTC on Wednesday, especially accelerating the recovery.”

Dylan Donnelly takes over reporting from Steven Brown