CNBC: Bitcoin plummeted 7%, other cryptocurrencies also dived, accused of following Wall Street

Bitcoin has plunged more than 7% in the past 24 hours, trading at $38,5774 as of 11:19 p.m. ET, according to CoinDesk, a U.S. consumer news and business channel CNBC reported.

Ether, the second-largest cryptocurrency by market capitalization, is down 8 percent in the past 24 hours. It was trading at $2,860 as of 11:20 p.m. ET, having fallen to $2,809.51 in the past 24 hours, according to CoinDesk data.

The cryptocurrency’s decline followed Wall Street’s losses on Thursday. The Nasdaq lost nearly 5% for the week and the S&P 500 fell for a third straight week.

Rising interest rates led investors to sell positions in riskier assets as U.S. 10-year Treasury yields surged earlier this week. Yields move in the opposite direction of prices.

The Fed also said it plans to start shrinking its balance sheet, shrinking bonds and raising interest rates.

A common investment case for bitcoin is as a hedge against rising inflation due to government stimulus, but analysts say the risk is that a more hawkish Federal Reserve could hamper bitcoin’s growth.

However, as yields retreated later in the week, Edward Moya, senior market analyst at foreign exchange firm Oanda, said, “It’s a little surprising not to see Bitcoin react more positively to the reversal in U.S. Treasury yields. Disappointed."