The CMC Crypto Fear and Greed Index has plummeted below 50, reaching its lowest point since Oct. 14. This drop coincides with Bitcoin‘s BTC/USD price slipping under $92,000, marking a notable change in market sentiment.
What Happened: As of 3:20 am ET on Friday, Bitcoin was trading at $94,708.791 while the index stood at 42. The CMC Fear and Greed Index, a proprietary tool by CoinMarketCap, gauges the prevailing sentiment in the cryptocurrency market. This index, ranging from 0 to 100, reflects the emotional state of the market, influencing investor behavior.
A lower index value signifies extreme fear, while a higher value suggests extreme greed. The index aids investors in assessing whether the market is potentially undervalued or overvalued. This recent dip in the index suggests a shift towards fear among market participants, possibly impacting buying and selling decisions.
Why It Matters: The recent downturn in Bitcoin’s price and market sentiment comes amid a backdrop of volatility in the cryptocurrency space. As Bitcoin ETFs celebrated their first anniversary, they have demonstrated the unpredictable nature of the crypto market. The Grayscale Bitcoin Trust GBTC and iShares Bitcoin Trust IBIT have seen fluctuating fortunes, reflecting the broader market’s instability.
Additionally, economist Peter Schiff has recently criticized Bitcoin’s reputation as a safe haven asset. In a statement, Schiff argued that Bitcoin is “the riskiest asset,” challenging its perceived role as a refuge during economic uncertainty. His comments underscore the ongoing debate about Bitcoin’s position in the financial ecosystem, particularly as traditional safe havens like gold remain favored by some investors.
Price Action: As per Benzinga Pro data, in the past seven days, Bitcoin has dropped by 1.8%, Dogecoin DOGE/USD fell by 0.3% while Shiba Inu SHIB/USD saw a 3.9% decline, as of Friday pre-market hours.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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