Bitcoin has fallen sharply towards US$81,000 as hotter-than-expected US inflation revived fears of another Federal Reserve rate hike and triggered renewed selling across cryptocurrencies and other risk assets.

The world’s largest cryptocurrency was trading around US$81,600 at the latest check, down about 1.8% on the session after falling as low as US$81,392.

Bitcoin had traded as high as US$83,996 before selling accelerated, extending a retreat that has taken the cryptocurrency below the US$84,000 level it briefly reclaimed earlier this week.

The…