Bitcoin plunged Friday, taking the digital currency briefly below $11,000 and down 47 percent from a record high hit at the start of the week.

Bitcoin had rallied to a record high above $19,800 on Sunday and was trading near $15,500 for much of Thursday New York time, according to Coinbase. But an afternoon selloff accelerated into the night, and bitcoin dropped 30.2 percent Friday morning to a low of $10,400 on Coinbase. It had recovered above $14,600 by Friday afternoon, off 27 percent from the all-time high.

There were no immediately apparent explanation for the selloff and extreme volatility.

"I would say the drop in bitcoin is a result of the massive new inflows of retail investors who are relatively 'weak hands' and more prone to sell at the sight of falling prices than the capital that has been in the system for a while that has a longer term outlook," Alex Sunnarborg, founding partner at cryptofund Tetras Capital, said in an email.

Adding to the confusion, trading on Coinbase was disabled for more than two hours in the middle of the day. The company had more than 13 million users at the end of November.

At its lows, bitcoin had fallen 47 percent in just five days and lost about $9,400. The digital currency erased more than $1,000 in one hour alone Friday morning.

Bitcoin performance during one hour Friday morning

Source: Coinbase

Bitcoin futures also tumbled Friday. The CME bitcoin futures expiring in January, which launched Sunday, reached "limit down," falling nearly 20 percent to $12,265 in morning trading before settling 7.8 percent lower at $14,135. Markets were still open for trading.

The Cboe bitcoin futures contract, which launched Dec. 10, briefly dropped 21 percent to $12,050 after triggering a brief, built-in trading halt due to price volatility. The futures settled 8.7 percent lower at $13,960.

Trading volume in the Cboe bitcoin futures contract for January more than doubled from Thursday to a record of 12,554 contracts Friday. The equivalent trading volume in CME's bitcoin futures was near 11,800 contracts, also the highest since their launch.

The bitcoin offshoot, bitcoin cash, collapsed, temporarily falling 40 percent Friday to $1,873, after topping $4,000 two days ago, according to Coinbase. Bitcoin cash recovered to trade near $2,897 in afternoon trading.

Despite the selloff, bitcoin is still up more than 1,300 percent for the year and bitcoin cash is still up more than 380 percent since it split off from bitcoin on Aug. 1.

"Investors were sitting on such significant gains that a correction was inevitable," said Benjamin Roberts, co-founder and CEO of Citizen Hex, an ethereum-focused start-up backed by three Canadian venture funds.

"These markets are driven in the short term by word-of-mouth adoption and profit-taking, and in the long term by the increasing utility of blockchain tech," Roberts said in an email.

Blockchain eliminates the need for a third-party intermediary by creating an instant, permanent record of transactions between two parties.

Bitcoin, the first application of blockchain technology, has come a long way since its inception less than a decade ago. More than 120 "cryptofunds" have formed this year, according to financial research firm Autonomous Next, and many expect the launch of bitcoin futures will encourage more institutional investors to buy into the cryptocurrency trend.