Depending on whose estimate you believe, as much as 10% of the population of Iceland demonstrated outside Parliament yesterday, and everyone agrees that they were the largest demonstrations in Icelandic history (and possibly the largest demonstrations, proportionally of any country in history).
While the PM initially refused to contemplate resigning over the scandal, the BBC reports that he has now asked the President to dissolve Parliament, which will prompt snap elections.
I speculate that this may be driven by the PM's inability to hold together his coalition government. All government business was cancelled yesterday as the center-right coalition met to negotiate their response to the leaks.
A recent poll put Iceland's Pirate Party — who've previously called for asylum and diplomatic passports for Edward Snowden and Julian Assange — as the party most likely to form a government if elections were called.