Bitcoin is facing selling pressure at press time, having failed to move above a long-held resistance level on Tuesday.
The leading cryptocurrency is currently trading near $11,390, representing a roughly 4% decline on the day, according to CoinDeskâ€™s Bitcoin Price Index.
Prices dropped by nearly $400 in just minutes, but have bounced slightly at the time of writing.
The sell-off has coincided with a report that South Korean authorities have seized Bithumb, one of the countryâ€™s biggest cryptocurrency exchanges by trading volume.
â€œWe are seeing a significant unwinding of leverage positions in bitcoin and major alternative cryptocurrencies on Bithumb news,â€ Matthew Dibb, co-founder ofÂ Stack, a provider of cryptocurrency trackers and index funds, told CoinDesk in a WhatsApp chat.
The bulls failed to establish a foothold above the $12,000 mark on Tuesday.
The cryptocurrency has failed at least four times to keep gains above $12,000 in the past five weeks.
Immediate support is located at $11,170; a violation there would confirm a head-and-shoulders breakdown, a bearish technical pattern, on the four-hour chart.
That possibly cannot be ruled out as the U.S. dollar is showing signs of life.
Bitcoin has developed a relatively strong negative correlation with the greenback over the past few weeks.
The dollar index, which tracks the value of the greenback against other major currencies, is now near 92.50 at press time, having clocked a 29-month low of 91.75 on Tuesday.