Bitcoin dropped 6.1 percent to $18,866.77 at 2004 GMT on Thursday, and then gradually recovered between $19,600 to $20,000 on Friday, compared with the year's high of $48,234 on March 28.

Several big players in the cryptocurrency markets have had difficulties, and further declines could force other crypto investors to sell holdings to meet margin calls and cover losses.

Both digital assets have struggled since U.S. based lender Celsius Network this month said it would suspend withdrawals. Bitcoin and ether were further rattled by the apparent insolvency of crypto hedge fund Three Arrows Capital, which a person familiar with the matter told Reuters has entered liquidation.

Many of the industry's recent problems can be traced back to the spectacular collapse of so-called stablecoin TerraUSD in May, which saw the stablecoin lose almost all its value, along with its paired token.

(With inputs from Reuters. Cover photo from CFP)