A gauge used to assess sentiment towards cryptocurrencies has reached “extreme fear” as the price of Bitcoin (BTC) fell near $60,000 U.S. on Feb. 5.
The “Crypto Fear and Greed Index” is currently at level nine, a reading categorized as “extreme fear” and one that has typically appeared only during major breakdowns in confidence.
Investor sentiment towards crypto is now at its bleakest level since the FTX exchange collapsed in late 2022.
The index stood as high as 42 in January of this year, showing how quickly investors and traders have shifted from cautious to defensive when it comes to crypto.
The fear gauge is built primarily around Bitcoin, which fell near $60,000 U.S. on Feb. 5 before bouncing up to $65,000 U.S.
While the rebound suggests some investors are willing to buy the dip, the sentiment reading implies the broader market remains extremely fearful of the current slide in crypto prices.
The Crypto Fear and Greed Index does not predict where Bitcoin goes next. Some analysts are now eyeing $50,000 U.S. as a potential bottom for BTC.
