Although Bitcoin and cryptocurrencies appear unusually volatile in December, the bulk of the volatility may be due to adjustments in portfolios, including obtaining cash at favorable rates with an eye to 2017 tax year reports, by individuals and organizations with significant holdings. As these large holders of Bitcoin and alt currencies take profits, as well as off-setting losses for tax purposes, they can create big, sudden movements.
When one factors in the increasing publicity about Bitcoin, which has lured large numbers of new cryptocurrency investors, then one can witness large positions in Bitcoin et al being unloaded for end-of-year tax purposes overwhelming the newer and more modest buyers of Bitcoin et al. The newbies may suddenly panic and sell at losses. I do believe that something of the sort has occurred this last month of the year. After all, it is traditional for investors in the stock & bond markets to "adjust" their holdings in December. Again, this is done for tax purposes as well as entering into positions more easily defended in reports to organizations and large securities holders, regarding leadership's stewardship of organizational assets.
For new investors it would have been wise for them to wait until January 2018 to take positions in cryptocurrencies, allowing December 2017 to be a month to size up the best investment options. Also, delaying tax liability a year would also be a wiser course for investors.
The year 2018 should prove very interesting geopolitically and in terms of currencies, commodities and cryptocurrencies.