The selloff began Monday and extended into a second day, with the digital asset down more than 5% since Monday at 5 p.m.
They were also caught up in a flurry of risk taking in markets, which included some of the most speculative growth stocks.
Some signs of nervousness are beginning to show in broader markets as concerns about runaway inflation rise after the biggest uptick in consumer prices in the U.S.
Traditional safe-haven assets such as the dollar and gold have rallied.
The dollar’s strength also indicates investors continue to bet that the Federal Reserve may have to raise interest rates to deal with inflation, according to researchers at Capital Economics.
This matters for cryptocurrencies because tighter Fed policy would weigh on the broader market and likely hit the riskiest assets hardest, said Joel Kruger, a currency strategist at LMAX Group.
The next step would be to target cryptocurrency-mining activities being conducted on an industrial scale and state-owned companies involved in the industry, Ms. Meng said.