The Fear and Greed Index, a prominent Bitcoin sentiment indicator, has dropped to the "extreme fear" level, scoring only 25 out of 100. This is the index's lowest reading in 18 months. The last time this happened was during the bitcoin market's recovery after the FTX exchange's collapse.
At present, the market base of cryptocurrencies is struggling to respond to the Mt. Gox repayments. It is making way for a consistent selling campaign by the Germany-based Saxony state. On Thursday, the digital token hit $59,516 because of the lower inflation figure reported in the US, increasing the chances of multiple rate cuts in the year. Nevertheless, the rally to the $60,000 level again failed to hold the necessary support. Saxony sold $286 million worth of Bitcoins to various exchanges that day, which also pressured the cryptocurrency. The good news is that Saxony now holds less than 10% of the confiscated initial coins from the Movie2k website back in January.’
ETF Inflows Offer Potential Relief
A steady stream of Bitcoin exchange-traded fund (ETF) inflows is expected to improve current market sentiment. On Thursday, ETFs recorded nearly $79 million in fresh investments, with BlackRock's IBIT accounting for most of the sum. Despite recent market turbulence, these inflows indicate growing institutional interest and confidence in Bitcoin. As of this writing, Bitcoin is fetching $57,246, based on CoinGecko numbers. The cryptocurrency market is still weak, although the low supply from Saxony continues, and ETF continues to purchase more tokens.
In conclusion, while Bitcoin faces significant challenges, the market may see improvements with reduced selling pressure from Saxony and increased institutional investment through ETFs. Nothing is more accurate than the statement that the Fear & Greed Index entered the region of extreme fear, proving the concept of the current market's volatility and instability.
The post "Bitcoin Sentiment Dips to Extreme Fear as Market Faces New Challenges" first appeared on 36crypto.com News.
