News that the Federal Reserve might raise interest in the coming months caused massive panic in the cryptocurrency industry. Bitcoin, Ethereum, and the entire cryptocurrency market crashed down in value. However, one Bitcoin whale took advantage of the dip to buy $24 million worth of BTC.

Since Friday, cryptocurrency markets have continued to lose value at alarming rates. The drop is spearheaded by Bitcoin, which fell by 6 percent with a value of $41,737 at the time of writing. According to USA Today, this caused Ethereum to fall by 8 percent, Solana by 10.6 percent, Terra by 9.1 percent, and Avalanche by 9.7 percent.

Ethereum Price Drop: Why Are Cryptocurrencies Down?

Cryptocurrency markets are generally volatile, so their price movements are highly unpredictable. However, the recent drop might be linked to two recent developments.

First is the Federal Reserve announcement that interest rates might increase some time in March. According to The Wall Street Journal, Feds are using this to combat inflation and tighten regulation on cryptocurrency markets. Many traders saw this as a threat to their investments.

Second is the ongoing unrest in Khazakstan, per Cnet. Since China's crackdown led to cryptocurrency mining bans, traders moved their operations to Khazakstan. This country is recognized as the second biggest Bitcoin miner, standing behind the U.S. However, because of protests over fuel prices, Kazakhstan's government shut down its internet connection. This caused the Bitcoin hashrate to fall by 13 percent.

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Bitcoin Price Drop: Should You Invest in BTC?

The sudden Bitcoin drop is a devastating blow to Bitcoin miners. Many get their revenue by providing Bitcoin mining services, so when the market goes down, their revenue also goes down. Due to the nature of the market, these miners have no way to offset their costs. Eventually, miners might be discouraged and the Bitcoin net income might continue to drop dramatically.

The Spectator Index listed all of Bitcoin's value in these last few months for reference on the massive drops.

The change in market prompted Bitcoin Fear and Greed Index to score Bitcoin 18, where traders feel "extreme fear."

Bitcoin Whale Buys $24 Million BTC

Although these changes cause unrest to a lot of traders, not everybody sees it as a bad sign. According to Cryptopotato, the third-largest Bitcoin whale bought coins during the dip at insane amounts.

On Monday, the whale bought 456 Bitcoin for an average of $46,363 each. Then, purchased 372 Bitcoin for $17,122,242.1 on Tuesday.

It is speculated that the whale has a stack of over 121,000 BTC at the moment. This means their holdings is enough to rival the infamous MicroStrategy with its 124,391 holdings.

It is hard to determine whether Bitcoin can recover from the sudden dip. However, many other investors continue to believe in its potential. Hopefully, the trades will get better in the coming days.

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