The price of Bitcoin (BTC), the largest cryptocurrency by market cap, dropped 7.97 percent on a daily basis. BTC, which was traded at $ 43,181 at the time of writing, fell to $ 42,412 on the Bitstamp exchange. This indicates that the leading cryptocurrency, which rose to $ 46,929 in the past day, has lost more than $ 4,000. So why did the decline occur?
What is behind the drop in Bitcoin price?
The market turbulence came after the Federal Reserve’s (FED) December meeting, announced on Wednesday, showed the central bank could raise interest rates next March, experts say. The news also plunged US stocks sharply. On the other hand, altcoin prices also suffered heavy losses. Leading altcoin Ethereum (ETH) fell 9 percent to $3,461, while Binance Coin (BNB) fell 8 percent to $470. Major altcoins such as Solana (SOL), Cardano (ADA), XRP, Polkadot (DOT) also dropped close to 10 percent.
Meanwhile, BTC mining seems to have taken a big hit. Cryptocurrency mining also seems to be facing another headwind in its industry, due to a wave of protests erupting in Kazakhstan, the second largest Bitcoin mining centre. The country’s government decided to shut down the nationwide internet to quell the unrest, forcing local miners to shut down their equipment. The hashrate, which peaked at 229 EH / s in the past days, dropped to 165 EH / s. Mark Newton, managing director of Fundstrat Global Advisors, states that $45,655 is an important support level for Bitcoin. It is worth noting that now that it has fallen from this level, the flagship cryptocurrency could drop below the $40,000 level for the first time since September 2021.