Bitcoin declined on Thursday, extending overnight losses following the release of US consumer inflation data that came in higher than forecast.
This has fueled bets that the Federal Reserve will raise interest rates again before the end of the year.
Prices for other cryptocurrencies also fell, continuing a downward trend that began with a weak start to October.
As of 08:49 Moscow time, Bitcoin was down 3.2% at $80,791.4, hovering near its lowest level since September 20.
Bitcoin under pressure from "hot" inflation and rate-hike expectations
Bitcoin saw a sharp overnight drop after US Consumer Price Index (CPI) data for September exceeded expectations.
The report also showed an increase in core inflation, as a steep rise in energy costs spread to broader sectors of the economy.
The CPI figures have heightened concerns that the Fed will implement at least one more interest rate hike before the end of the year—a move that typically weighs on speculative assets like cryptocurrencies.
According to the CME FedWatch tool, markets are pricing in a 70% probability of a 25-basis-point rate hike by the Fed in December, following a similar move in September. Expectations remain that rates will be held steady in October.
The CPI data also triggered a major sell-off in global technology and artificial intelligence stocks, as investors lowered their valuations of the sector's future earnings in an environment of rising interest rates.
This sell-off sparked a broad flight from risk across financial markets, which also impacted the cryptocurrency market. Inflows into spot Bitcoin exchange-traded funds (ETFs) turned negative on Wednesday following the release of CPI data; according to SoSoValue, outflows reached $261.5 million.
Data from Coinglass shows that $966.2 million worth of cryptocurrency positions were liquidated over the last 24 hours, the majority of which were long positions.
Crypto market today: Altcoins fall under pressure from interest rates
Cryptocurrency prices broadly declined on Thursday, following Bitcoin, as the prospect of rising interest rates exerts significant pressure on speculative assets, including cryptocurrencies.
Higher interest rates generally have a negative impact on cryptocurrency valuations, as capital shifts toward safer, higher-yielding debt instruments.
Ether, the world’s second-largest cryptocurrency by market capitalization, fell 5.7% to $2,360.53, while XRP dropped 4.7%.
Solana fell 4.8%, Cardano declined 6%, and BNB lost 3.5%.
Memecoins Dogecoin and $TRUMP fell by 5.6% and 7%, respectively.