Bitcoin overnight suffered its biggest one-day price plunge, retreating from a record high above $60,000 at the weekend, after a halt in retail trader-driven rally that market observers said was a result of participation from institutional investors, according to Coindesk, Tuesday.

BTC's price was trading at around $56,671.14 early Tuesday after the crypto fell to $54,790.32 during Asian trading hours late Monday, falling 11% from Saturday's record high of $61,556.59.

Bitcoin had reached a record high on Saturday after U.S. President Joe Biden signed off on his nearly $2 trillion stimulus package and ordered an acceleration in COVID-19 immunizations.

The drop in the BTC price came in the wake of reports that India could ban cryptocurrency trading altogether, potentially cutting off one of the largest markets in the world.

"The fresh all-time high on Saturday above $60,000, coupled with the closure of traditional markets that has recently kept BTC yoked, meant a hopeful chase by retail participants," Coindesk quoted Singapore-based quantitative analysis company QCP Capital as saying in its weekly market update.

As some investors tend to consider bitcoin as a hedge against inflation, analysts believe the increase in its prices has been helped by the prospects of a steep economic recovery.

Senior government officials in India were working on a new measure that will ban cryptocurrencies. People could be penalized for mining or owning digital assets under the policy, Reuters reported.

Despite Monday's pullback, many crypto analysts believe the projection for bitcoin's price remains on course to the upside. India's proposed legislation will not impede Bitcoin's further gains, Seth Melamed, the Tokyo-based chief operating officer of cryptocurrency exchange Liquid, said.

Meanwhile, Richard Byworth, chief executive officer of Nasdaq-listed cryptocurrency exchange Diginex, predicts Bitcoin to triple in value before 2022.

"We're modeling out around $175,000 for the price of Bitcoin by the end of this year," Byworth said during an interview with Bloomberg on Monday.

According to Byworth, Bitcoin's so-called bullrun is still in its initial stages and "things are going to get a lot more heated from here," as per Coindesk.