Investor Sentiment in the Crypto Market Shows Extreme Fear

Investor sentiment in the crypto market significantly declined on Tuesday after Bitcoin briefly fell below $104,000 for the first time in over three weeks.

The crypto Fear and Greed Index dropped by half on Tuesday from 42 the previous day to a score of 21 out of 100, indicating ‘extreme fear’ in the crypto market.

Bitcoin is currently trading below $104,000, having experienced a decline of over three percent in the last 24 hours.

The sentiment tracking index for cryptocurrencies reached its lowest value in nearly seven months on Tuesday, after falling to 18 out of 100 on April 9. On that day, the stock and crypto markets fell in reaction to the comprehensive global tariffs imposed by U.S. President Donald Trump, which took effect that day.

‘Extreme Fear’

The cryptocurrency Fear and Greed Index last fell to the level of extreme fear on October 22, reaching a score of 25 out of 100 after Bitcoin dropped from over $110,000 to below $108,000.

The index fluctuated between extreme fear and neutral after the market decline on October 9 and 10, when Bitcoin quickly cooled from a peak of over $126,000 reached on October 6.

The index was last above a neutral rating before the decline in early October, reaching a monthly high of 74, indicating greed, on October 5.

Analysts attribute the current decline in Bitcoin to reduced institutional demand and blockchain activity, as well as concerns over the increasingly aggressive stance of the Federal Reserve.

The Fed cut interest rates for the second time this year on Wednesday but signaled that it may not do so again in 2025, causing a drop in the crypto market as investors had hoped for further rate cuts.

Last week, Bitcoin-related ETFs recorded a net outflow of nearly $800 million, with institutional buying falling below daily miner supply for the first time in seven months.

Crypto bulls are hoping for the so-called ‘Moonvember,’ as Bitcoin has historically averaged over 42% growth in November, which is typically its best month for growth.