Why is there a hole in my basement wall?
The clue here is that the hole leads into an area that is under another part of the upper building structure. It is highly likely that the corresponding part of the building in that area does not have full headroom clearance and thus leaves that area as a "crawl" or "access" space. The hole is what allows you to enter that space if there is need for maintenance and/or repairs. The hole also allows for some air circulation from that area into the rest of the basement to help control humidity and temperature.

I would advise that you do not want to try to dig down the dirt floor space in that area because that would most likely cause you to be digging below the foundation levels in that access space. You do not want to be digging below the foundation levels as that can lead to foundation movement or long term failure.