I don't see someone sitting on 400k, believing they're worth just .40 and not taking bids above .70 -- doesn't sound credible.
I can imagine when someone with enough bitcoins would accept all bids over .4 (effectively clearing the demand at whatever proposed buy price) that the exchange rate would plunge there instantly. how shallow is any of the exchange markets?
the february rise could be caused by the rumour LR changing AML/KYC rules and people just fled LR and bought BTC. since then parity then the price is correcting itself downwards back to .40 anyway. should have bought the wool socks then