Crypto investors are close to extreme fear as Bitcoin fell to $50,000

The weekend has been characterized by a rollercoaster of emotions for the crypto community, with fear for investors who are worried about the latest market conditions.

According to current data from Alternative.me, the Crypto Fear & Greed Index stood at 26/100, indicating fear among investors. If the market condition worsens, the indicator may approach extreme fear, a sentiment that could further harm the market.

Source: Alternative.me

Investors fear market conditions

The Crypto Fear & Greed Index compiles the dominant emotional sentiments of investors at a given time. The gauge comprises five main states: Extreme Fear, Fear, Natural, Greed, and Extreme Greed. This indicator helps market participants access the prevailing emotional conditions needed to make the right investment decisions.

A fear index indicates that investors are afraid of market conditions and of selling their crypto deposit. Alternative.me data showed the indicator was 34/100 yesterday. However, their current metrics show that fear has grown.

The last time this fear gripped the crypto market was in mid-July, when the German government sold 50,000 BTC seized from movie piracy website Movies2K. BTC then fell to $54,000, the first such drop since late February.

Why is the market pouring?

The reason for investors’ fears about market conditions is not far-fetched. Hours ago, the leading cryptocurrency fell below $49,500 for the first time since mid-February. This major drop has wiped over $500 billion from the crypto market over the past few days.

Although BTC has regained the $52,000 price mark, staying in this range for hours may raise suspicions that the asset may go lower again.

In a recent tweet, BitMEX co-founder Arthur Hayes attributed the sudden price drop to a whale dumping crypto. Other factors that may have triggered the bearish trends are the weakening of the US economy, the uncertainty surrounding the US Federal Reserve’s next move in its fiscal policy and the frequent exits of the Bitcoin exchange-traded fund at the time .

SPECIAL OFFER (Sponsored) Binance Free $600 (Exclusive to CryptoPotato): Use this link to register a new account and receive an exclusive welcome offer of $600 to Binance (full details).

2024 LIMITED OFFER on BYDFi Exchange – Up to $2888 Welcome Reward, Use this link to register and open a 100 USDT-M position for free!