Bitcoin had a wild ride over the past two years, with prices driven by speculation, investment and government regulation, and investors should expect nothing less in 2015.

"Although the swings in absolute value seem to be lower in 2014 than they were at the end of 2013, the volatility will likely remain for the next few years," Zennon Kapron, managing director of Shanghai-based market research firm KapronAsia told CNBC.

"Bitcoin is largely a binary outcome with it either being a tremendous success or reduced to something only used by enthusiasts. There is a tremendous amount of private equity and venture capital money being put into bitcoin to create new and compelling business models, but the only thing that will temper volatility is increased acceptance and usage," he said.

Bobby Lee, CEO and Co-Founder of China-based bitcoin trading platform BTC China agrees: "Volatility will be inherent for this new asset class. The reason is simple: It has a small circulation value now, but theoretically, with wide adoption, the circulation value should be 100x or 1,000x what it is today," he said. "The price would have to appreciate dramatically, and that would involve very high volatility for years to come."

An over 8,000 percent price increase over the course of 2013 to its peak of around $1,147 early that December put bitcoin on the map. In early 2014, bitcoin's fall was just as quick; concerns about increasing government regulation and a market bubble saw bitcoin's value halve in just a few months.

Bitcoin is currently trading around $337 on the BTC-e exchange.

Driving forces for 2015

Developments on three fronts have the potential to drive bitcoin higher in 2015: a better usage model, more companies using blockchain-based technology and increased usage for remittances.

"Bitcoin is a technology that still needs to find its use case," Kapron said. "The iPhone defined an industry by giving consumers and businesses something that they didn't know that they needed. For bitcoin, there's no proven killer app, although numerous players are working on it. We need a bitcoin usage model in 2015 that does something better today than we did yesterday, and we're just not there yet."

Provided by CNBC

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Bitcoin: What to expect in 2015