As BitcoinThe largest cryptocurrency asset, continues to show bearish movement today, dropping from around $65,000 to $62,700, sellers appear to have returned to the market, raising concerns in the industry about possible downward pressure on BTC’s value. This recent development follows high price volatility, which has raised uncertainty among investors.
Bitcoin sellers have become active in the market
In a recent study shared on the leading blockchain data provider platform, CryptoQuantXBTManager, a crypto trader and on-chain analyst, has quoted a potential return of Bitcoin sellers to the market. Recent data indicates a possible increase in selling activity following the current price fluctuations and crashes, suggesting a change in investor sentiment.
According to the on-chain analyst, Bitcoin has seen a strong surge in the past week, breaking out of its previous range and entering a period of volatilityHe noted that the price drop implies that Bitcoin could begin a free fall.
However, as BTC faced high volatility, several networks that were inactive during these events began to become active again. Additionally, based on the age-band data for spent production from 1 week to 1 month, over 33,155 Bitcoin have been moved by short-term holders, which could lead to immediate selling pressure from these holders.
If these age group movements were to become more pronounced, the expert stressed the importance of increased caution as they can sometimes become intense. Therefore, he urged investors to be attentive to such developments in the coming days.
BTC Open Interest Sees Negative Movement
The drop in prices also led to a decline Bitcoin Open Interest (OI) on all exchanges. Leader Market intelligence platform Santiment revealed that on the last day there were a slight 2.2% drop in the price of BTC, which resulted in a significant drop of around 7.5% in total open interest across exchanges.
Related Reading: Bitcoin Open Interest Falls as BTC Surges Above $60,000
In the meantime, There has been little decline in overall open interest for altcoins like Ethereum (ETH) and Solana (SOL). So, Santiment highlighted a few takeaways as BTC open interest declines.
The first development highlighted by Santiment is the shift in investor focus from Bitcoin to altcoins. Indeed, with ETH, SOL, and other notable altcoins posting significant recovery since the August 5 crash, traders may see more potential in these cryptocurrencies.
Another important takeaway is the de-risking of BTC. According to Santiment, traders may be reducing their exposure due to the uncertainty. “The lack of open interest in ETH and SOL is more due to the fact that they are less sensitive to BTC price than usual this month,” Santiment added.
Other key takeaways highlighted by the intelligence platform include the rotation of capital from Bitcoin to altcoins due to a slight drop in prices and a change in market sentiment.
Featured image from Unsplash, chart from Tradingview.com
