However, this does not come as a surprise. I predicted long time ago that Bitcoin would become more unstable over time due to its lack of intrinsic value.
Things that are far removed from reality are by their very nature extremely difficult to price.
Unfortunately for us, Bitcoin is just a symptom of a bigger problem. Financial markets are awash with derivatives of various kinds. For every conceivable product or service, there is some derivative in which the speculator can make massively leveraged bets.
Gold is no exception in this respect. Huge bets are made with no real link to reality. No-one has hundreds of tonnes of gold to trade. But that is not a hindrance in today's world. Derivatives are after all just paper contracts. There's no limit to the size of the bets that can be made.
This means that the increasing volatility that we have seen in Bitcoin is likely to come to all asset classes in the not too distant future. Prices are not driven by fundamentals, but by the shifting moods of the speculators, who in turn are making their bets based on the flow of fiat money coming from the world's central banks.
Hugely volatile brass token
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