The Crypto Fear and Greed Index, a measure of market sentiment for Bitcoin (BTC) and the broader cryptocurrency industry, has dropped to its lowest level in almost 18 months. On June 24, the index plummeted 21 points, entering the “Fear” zone and marking one of the most significant day-to-day declines in recent years. The last time it was in the Fear zone was around seven weeks ago on May 3, and it hasn’t gone below a score of 30 since January 11, 2023, when Bitcoin was trading at $17,200, just two months after the collapse of the crypto exchange FTX.
A week ago, the score was 74 in the “Greed” zone. Bitcoin is currently being traded at $60,300 after hitting a seven-week low on June 24. Negative sentiment has been fueled by outflows from spot Bitcoin exchange-traded funds, which have amounted to over $1 billion over the last 10 trading days. Additionally, there have been reports that Mt. Gox may be getting ready to sell $8.5 billion worth of Bitcoin to its creditors, and Germany has started selling some of its Bitcoin reserves.
However, an executive at cryptocurrency investment firm Galaxy Digital believes that the market may be overreacting to the concerns surrounding Mt. Gox. Bitcoin miners have been selling off more Bitcoin than usual due to a declining network hashrate, which may also have contributed to the weakening market sentiment. The Crypto Fear & Greed Index takes into account market volatility (25%), trading volume (25%), Bitcoin’s dominance (10%), and trends (10%). Previously, it also considered surveys (15%), but that metric is currently on hold. Since reaching a score of 90 “Extreme Greed” on March 5, when Bitcoin surpassed its previous all-time high of $69,000 set back in November 2021, the score has mostly been trending downward.