Raffael Danielli, quantitative analysis blogger behind Matlab Trading, said an Alibaba-influenced selloff could have been possible, but the current timetable does not make sense.
"Selling your Bitcoins yesterday (and during the night) will only put USD into your Bitcoin exchange account. From there you have to still transfer it to your stock broker which usually takes a couple of days," he wrote in an email to CNBC. "In other words: if (!) people sold Bitcoins yesterday to buy into Alibaba then they are a bit late to the party."
Danielli suggested instead that the bitcoin downtrend may be because of several factors, including merchants' increasing adoption of the currency. When someone uses bitcoin to pay for a product, the merchant typically converts it immediately back into U.S. dollars, which means that the market is increasingly flooded with sellers.
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For his part, Schiff pointed to a weak technical profile for the cryptocurrency that has seen an overall downtrend since its peak in December.
And while bitcoin proponents often point to the volatility as a natural part of the currency's marketplace—there were similar fits and starts when it was worth less than $100—Schiff said that this time around is different.
"They remember all that volatility in the beginning, and they think this is the same thing: That was the bubble inflating, this is the bubble bursting," he said.
—By CNBC's Everett Rosenfeld