The Bitcoin fear and greed index has dropped dangerously low to 15 out of 100 putting the market in a state of extreme fear. The price of BTC is currently at $42,868, breaking its previous support levels.

Bitcoin Drops Below Support

As per an article by CoinDesk, BTC was previously trading between its support at $45K and its resistance at $50K. Now, the price of cryptocurrency has dropped significantly below its last support.

The Bitcoin fear and greed index shows the market sentiment currently sitting at just 15 out of 100, which is one of the lowest BTC has dropped ever since the price dipped from its all-time high at $69K.

What are the Potential Factors Affecting BTC?

According to an article by NewsWeek, the price of Bitcoin goes down again as the Federal Reserve starts to mull interest rate hike and Kazakhstan's internet shuts down. With that, the US Federal Reserve noted that they would be raising interest rates very soon in order to fight inflation.

The publication, however, notes that it is not yet clear if the decision by the Feds directly impacted the price of BTC. To add, the price of Bitcoin fell from $46.7K down to around $43K overnight with its market cap, the value of all Bitcoins in circulation, down to just $817.7 billion.

Cryptocurrency Market Drops

The global crypto market also fell from its significant-high of $2.23 trillion to just a little over $2 trillion in a span of just a day. Other tokens like Ethereum and Cardano have also fallen by significant percentage points over the last 24 hours.

However, cryptocurrencies aren't the only markets affected, as the Dow Jones Industrial Average stock index fell by over 1%, with the S&P 500 falling below about 2%. With that, news of the rate hike came after notes from a Fed meeting in December 2021.

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Bitcoin Mining in Kazakhstan Affected

The notes revealed that the officials are expressing their concerns regarding inflation spreading through the economy might last longer than previously expected. However, positive employment figures could mean low-interest rates might not be needed anymore.

To add to everything that has been happening, Bitcoin mining was affected by a large internet shutdown in Kazakhstan. Also, the network blackout happened amidst protests, and for BTC, this meant that one of the world's largest mining communities was hit.

The article makes it difficult to point out just how much Bitcoins are minted in Kazakhstan. As of the moment, it is hard to say if Bitcoin will ever resume its bull market any time soon.

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Written by Urian B.