Bitcoin prices stabilized on Wednesday, following enormous volatility in the early part of the week.

Bitcoin (BTC/USD) eased down 0.06%, or 28 cents, on Slovenia-based BitStamp to trade at $484.00 during U.S. morning hours.

Elsewhere, the price of a Bitcoin on Bulgaria-based BTC-e dipped 0.11%, or 52 cents, to trade at $474.00.

According to the CoinDesk Bitcoin Price Index, which averages prices from the major exchanges, prices of the crypto-currency declined 1.66% to trade at $478.67.

Meanwhile, euro-denominated Bitcoin prices (BTC/EUR) slumped 1.42%, or €5.29, to trade at €366.52 on U.S.-based Kraken Exchange.

Bitcoin prices tumbled sharply on Monday, before rallying on Tuesday as investors returned to the market to seek cheap valuations.

Prices on BTC-e plummeted to $309.00 on Monday, in what is being referred to as a "flash crash", before recovering to end the day at $440.04.

Market participants speculated that Monday's losses came as a result of excessive margin trading, which caused a flash crash on the BTC-e platform and at least on one additional exchange.

The steep decline then had a cascading effect across the larger Bitcoin market, which dragged prices sharply lower.

A number of traders and market analysts also attributed the plunge to price manipulation by short-term profiteers who are deliberately driving prices down to eventually buy them back at lows.

Prices of the virtual currency have lost more than $100, or 17%, since the U.S. Consumer Financial Protection Bureau issued a lengthy set of risks that virtual currencies pose to consumers on August 11.

Bitcoin is digital cash and is not backed by a government or central bank to regulate or issue it. It can be used to purchase goods and services from stores and online retailers.

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