In simpler terms, the Crypto Fear & Greed Index, which reflects the collective emotions of Bitcoin and other cryptocurrencies, dropped by 19 points in a single day, reaching its lowest level since October 14.
One day, the index experienced a significant decrease, falling from 100 to 50 points – one of its largest daily declines over the past few years. This drop has led market sentiment to shift into the “Neutral” region following a three-month stretch in the “Extreme Greed” and “Greed” regions.
On January 9th, when Bitcoin’s (BTC) value dipped below $92,000, there were reports that the U.S. Department of Justice was given permission to sell off $6.5 billion worth of the 198,000 Bitcoins they seized from Silk Road. However, no Bitcoin has been sold as of yet.
Experts are also noting a possible drop due to the prediction that the U.S. Federal Reserve could tighten its monetary policy in 2025. This potential move might influence Bitcoin and the overall crypto market.
In the past few weeks, Bitcoin has struggled to stay above $100,000 due to an increase in U.S. Treasury bond yields and a stronger American dollar.
On January 8th, there was a significant withdrawal of approximately $570 million from U.S.-based Bitcoin exchange-traded funds. This substantial outflow, as pointed out by Markus Thielen, the founder of 10x Research, on January 5th, suggests that the price of Bitcoin could potentially drop even more.
The Crypto Fear & Greed Index calculates a total score by considering several factors such as market turbulence (accounting for 25% of the score), trading activity (also 25%), public sentiment on social media (15%), Bitcoin’s influence in the market (10%), and current trends (another 10%). This combined assessment helps determine an overall evaluation.
On November 22, the index score peaked at an all-time high of 94 out of 100, as the market was still celebrating Donald Trump’s presidential win and the growing anticipation about a potential U.S. Bitcoin reserve in 2025.
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2025-01-10 08:26