Here's what was behind Bitcoin's sharp market health decline seen this week

This price plunge has also caused the cryptocurrency to see a sharp downturn in its market health over a one-week period.

This network health decline stems from a decrease seen across BTC's network growth, liquidity, and investor sentiment.

These factors could spell trouble for where the cryptocurrency trends in the week ahead.Volatile price action leads Bitcoin to pivotal level.

At the time of writing, Bitcoin is trading down just under 1 percent at its current price of $8,905.

Whether or not it is able to remain above this price level could be one of the sole factors that determine which direction it will trend in the days and weeks ahead.BTC's $1,000 selloff leads to a sharp decline in network health.

Bitcoin's network health - as indicated by Glassnode's proprietary GNI indicator - took a hit this week in the wake of the crypto's recent decline.

According to the analytic firm's latest weekly report, all three core components of the GNI indicator saw a sharp regression over the past week.

A similar trend can be seen while looking towards BTC's liquidity, which is currently at its lowest value seen since January of this year.

The sharpest decline by far can be seen while looking towards the sentiment component of the GNI, which shed 20 points this week.

Although the link between the GNI's components and Bitcoin's price action is not necessarily causal, it does indicate that the immense fundamental strength seen in recent months is beginning to wane.