Bitcoin has seen heightened volatility throughout the past several hours, as it recently broke below the key support it had at $9,000 as buyers struggle to maintain the cryptocurrency’s mid-term uptrend.
BTC’s decline has led investors to grow increasingly fearful as to what could come next and has created a resurgence of trading activity on margin platforms like BitMEX.
This is indicated while looking towards the open interest on the platform, which has risen by roughly $30 million over the past several hours.
It now appears that retail investors may be preparing to sell their Bitcoin in order to hedge against further downside, as the number of exchange withdraws has decreased significantly as of late.
Bitcoin’s decline below $9,000 sparks fear, leads to a resurgence in trading activity
Over the past couple of days, Bitcoin has been trading sideways within the lower-$9,000 region, struggling to garner any decisive momentum following its recent rejection at $10,000.
The cryptocurrency now appears to be at risk of seeing further downside as $9,000 begins flipping into a resistance level. If it sustains below this level for an extended period of time, it could open the gates for the crypto to see further downside.
It also seems as though that traders are preparing for it to see even further volatility in the near-term, as Bitcoin’s open interest on BitMEX has rocketed by over $30 million throughout the past 12 hours, per data from Skew
This coincides closely with a trend of growing fear amongst investors – as discussed within a recent CryptoSlate report.
This fear could perpetuate a selloff if nervous retail investors begin offloading their Bitcoin in anticipation of it seeing further downwards momentum in the days and weeks ahead.
Exchange withdraws see significant decrease as investors watch for further volatility
Cryptocurrency exchanges have been seeing massive outflows in recent times, with investors moving their BTC to cold storage as they begin adopting a long-term investment strategy.
This trend is shifting on a lower time frame, however, as data from research platform Glassnode indicates that exchange withdraws have declined by 25% over the past 24 hours.