Bitcoin has bounced back above $4,000 (£3,128) today after plunging in value earlier this week.

The cryptocurrency hit $4,205.47 during today’s trading, bouncing back from a 14-month low of $3,474 on Monday according to data from Luxembourg-based Bitcoin exchange Bitstamp.

Today’s rally has seen a rise of more than 11 per cent and puts the world’s largest cryptocurrency on course for its biggest daily rise since mid-April, when its price was more than $7,500.

But its value remains 78.6 per cent lower than an all-time high of $19,666, which it hit in December last year.

Other cryptocurrencies such as ethereum also made up some ground on recent drops.

Bitcoin has suffered a series of blows recently, with heavy selling pressure depleting its value by a third over the last two weeks. It is known as a highly volatile currency, and the drop follows a stable period in October.

Earlier this month settlements were reached between the US Securities and Exchange Commission (SEC) and two cryptocurrency companies, as the authority tried to crack down on suspected fraud among digital currency providers.

Bitcoin also faces an investigation by regulators, which are looking into whether market manipulation was behind its huge rise in value last year.