I pretty much seen this sort of thing happening. It's not like this is the first person to pull this kind of short and wash, even with smaller amounts of bitcoin.

If the government is interested in the coins, I can easily see them toying around with purchase and sell orders to make instant profits from
the resultant fluctuations in the markets.

Bitcoin has proven to be highly volatile in itself, most likely due to
holders jumping in for quick profits. You can make hundreds in a single day trading the same 1 BTC a day if you had the tech & software to do it.

This isn't going to be the last time this happens. Let's see if it quiets down.