If the price of bitcoin continues to drop, other markets could begin to feel the heat, according to Ron William, founder and principle market strategist at RW Market Advisory.

Bitcoin was seen trading below a psychologically key mark of $13,000 Friday, shaving $3,000 from its value in less than 12 hours.

William said that a fall in the digital currency's price is "very normal" but that a "broader contagion story" could loom if it headed down further.

"What I found important for clients and with people in the market to separate is the price story from the long-term disruption opportunity with bitcoin and blockchain in general," he told CNBC.

"Price is extremely irrational. And now it is looking — if we continue lower — that this could be a broader contagion story for the other markets."

Bitcoin's spot price was trading at $14,462 Friday, down 7 percent for the session, according to CoinDesk, which tracks cryptocurrency exchanges Bitstamp, Coinbase, itBit and Bitfinex. It has risen more than 1,300 percent since the beginning of the year.

"If we get a move back above $17,250, which is the recent technical breakdown level, and then of course the record highs around just under $20,000, we could see a lot of blue skied scope for the New Year, and a lot of people have been citing that," William said.

"But potentially that might be less on the bitcoin proxy and other cryptocurrencies. Either way I think it's interesting to caution some kind of risk across other markets because so many people are invested here. So there could be a potential deleveraging situation."

Deleveraging occurs when investors reduce their debts by rapidly selling an asset.

Several major digital currencies were seen trading lower Friday, with only Ripple's XRP in positive territory.