Crypto sentiment has fallen to its most worrying level in over eight months as ongoing macroeconomic uncertainty continues to unnerve market participants.
However, crypto analysts expect the bearish sentiment to be short-lived.
The Crypto Fear & Greed Index, which measures overall market sentiment, recorded an “Extreme Fear” rating of 10 in its Saturday update, its lowest reading since Feb. 27, when Bitcoin (BTC) fell below $95,000 on Friday and has yet to return above $96,000 on the time of publication, in keeping with CoinMarketCap.
The February low got here just days after spot Bitcoin ETFs posted their worst-ever day by day outflows of $1.14 billion as Bitcoin fell to $84,000 from $102,000 in the beginning of the month.
Indicators suggest the market is less bearish than previous downturns
Crypto market participants use sentiment indices to gauge the broader market's sentiment toward the sector and inform their decisions about whether conditions favor buying or selling.
The Crypto Fear & Greed Index has not reached this low a worth since February twenty seventh. Source: Alternative.me
However, Bitwise's European head of research Andre Dragosh argued that the situation will not be as dire because it could seem in comparison with previous downturns.
“Sentiment index is bearish, but less negative than previous corrections despite lower prices,” Dragosh said in an X post on Friday, noting that Bitwise’s crypto sentiment index is showing signs of reversal.
“Our Cryptoasset Sentiment Index also continues to point out positive divergence,” said Dragosh.
While US President Donald Trump recently signed a bill to finish the longest government shutdown in US history, an event that some crypto market participants had blamed for recent volatility, uncertainty stays over the US Federal Reserve's rate of interest cutting decision, which is usually related to the crypto market.
The Bitcoin chart signals a “potentially positive” development
Meanwhile, NorthmanTrader founder Sven Henrich told his 503,400 X followers on Friday that the Bitcoin price chart shows “something potentially positive” for Bitcoin bulls. “Falling wedge, positive divergence,” Henrich said.
A Messari research manager, known online as “DRXL,” said that in his eight years within the crypto industry, he had never seen “such dissonance between headlines and sentiment.”
“Everything we once dreamed of is going on, and yet by some means it feels…over,” he said.
Some analysts consider the dearth of a year-end increase to be a healthy sign. Bitwise Chief Investment Officer Matt Hougan recently told Cointelegraph: “The biggest risk was [if] We made it to the tip of 2025 after which there was a pullback.”
