Bitcoin (BTC) surged from less than one dollar in 2010 to $997 at the start of the 2017, and again to nearly $20,000 last December.
The token then sank to below $10,000 in value this week, lowering to $8,500 on Friday.
Today, as of 11am on March 18, the BTC token is down even further with a price of $7,631 and a drop of -8.02 percent.
Ethereal is also down 16 percent to $504, while Ripple is down to $0.59 – a loss of 12.34 percent.
Why is Bitcoin dropping today?
The drop comes after it was revealed cryptocurrency investors could face hefty tax bills as the IRS closes in.
According to the Internal Revenue Service, anything purchased using a digital currency is liable to be taxed as a capital gain.
So anyone who has cashed out or paid for anything using cryptocurrency may have capital gains to report to the IRS.
One Reddit contributor earlier this week claimed they had discovered they owe the IRS $50k because they traded in cryptos.
The user wrote they had ended up with a $50,000 tax liability on trades after they sold $120,000 worth of Bitcoin to buy different coins, which have a current value of $30,000.
And in New York, the state Public Service Commission has ruled that power companies can charge higher rates to cryptocurrency mining operations.
Those mining for Bitcoin using super high powered computers could face hefty bills in order to “prevent local electricity prices for existing residential and business customers from skyrocketing.”
However, despite the drop, Bitcoin is still showing steady growth, according to Richard De Sousa, a partner at AltcoinTrader.
Speaking to Business Report this week, De Sousa said the current Bitcoin crash is not new and in fact the coin is seeing a steady rise.
He continued: “We have had corrections that lasted 411 days to be exact, that was after the last all-time high.
“If you take out out the period November/December 2017 and just cut out that section in the graph, you will see a steady rise in the price through the years.
“We believe that there will be another bull run in the future and once again there will be a correction.”
De Sousa added his view was not a speculatory one but based on positive fundamentals of Bitcoin.
He said: “We believe in the fundamentals that this technology is disruptive and it will change financial landscape.
“It is at this stage forging its own path. The closest thing that we could consider it to is a store of value.
“It is not something that is traded back and forth very much, so we should be careful in its classification.”
Tom Lee, Fundstrat Global Advisors’ Head of Research, thinks Bitcoin could rise to $91,000 by March 2020.