The price of Bitcoin has tumbled sharply since the start of the year, with analysts saying the crypto-currency is at risk of a correction.
The volatile digital currency, which is backed by a decentralized network of computer code that has been around for years, surged more than 2,000% on Friday, with Bitcoin trading at $1,200 per coin.
In the first quarter, it gained 7% on average, according to data from Coinmarketcap.
But analysts say the digital currency’s rally is likely to be short-lived, and it could end up being worth less than the $10 it has now.
Bitcoin, which was invented in 2009 by an anonymous programmer, was launched as an alternative to fiat currencies like the US dollar.
The cryptocurrency’s rise in popularity has coincided with a series of high-profile hacks that have crippled the Bitcoin network, leading to the loss of over $20bn in value.
The latest blow to the crypto currency came after US federal authorities announced plans to prosecute three Bitcoin exchange operators for allegedly running a Bitcoin exchange business with illegal proceeds, though the case has yet to be announced.
Bitcoin’s value has also been negatively impacted by the US Federal Reserve’s interest rate hike, which has made Bitcoin more expensive to buy.
According to data compiled by Bloomberg, Bitcoin fell more than 8% to $1.0923 at 11:55 a.m.
ET on Friday.