Like every fiat currency today, bitcoin has assumed the position of a currency though typified as a crypto-currency. But in reality, it is obvious that the value of any country's currency depends to a large extent on her economic dynamics and activities (demand, supply, external reserve, level of production, etc.) . By that i mean, the strength of an economy determines the strength or purchasing power of her currency against those of others.
On this basis what can we allude to be the cause of the recent decline in value of bitcoin?
like you suggested, confidence in national fiat currencies is tied to economic factors and government meddling or instability. bitcoin is different. most of its market valuation is based in speculation on future adoption and utility IMO. while there is arguably value in bitcoin's mining (insofar as security) and utility insofar as the network size, it's still over-priced based on current usage alone.
the recent decline doesn't have to do with external factors as much as lack of demand. we had a crazy bubble last year and the market is still coming back down to reality, reverting to the mean. same thing happened in 2013-14.