The fear and greed index has risen to 94 today. I believe this round of market sentiment is very similar to the wave from the end of October 2020 to the beginning of 2021.
Many people's focus is now on Bitcoin, believing that most altcoins are still in a sluggish state, which seems to be just a manifestation of fear, hardly reaching the level of greed. However, if we look back at past history, we can find some similarities.
If the market fully replicates the situation at the end of 2020: at that time, Bitcoin broke through the previous high of December 2017, and by early January 2021, the price was already double that of the end of 2017, while Ethereum had not yet reached the highs of early 2018.
In contrast, the current price of Bitcoin is 1.5 times the 2021 peak, while Ethereum has reached about 70% of the 2021 peak.
Through this comparison, it seems that the market has somewhat recovered.
There are two views on the future performance of altcoins: one is that the market has not yet started, and it is necessary to wait for Bitcoin to continuously break through previous highs to truly trigger a bull market for the entire market.
The other view is that the market has changed this year, and investor sentiment has gradually shifted to rationality. Many altcoins still lack substantial applications and innovations, and the market has grown tired of hollow narratives.
Therefore, investors are now more inclined towards those low circulation, high FDV (Fully Diluted Valuation) VC coins. The market is gradually developing towards a structured approach - quality assets will receive more attention, while poor projects will be eliminated.
Overall, the current market sentiment has many similarities to the end of 2020 and the beginning of 2021, but it should also be noted that the maturity of the market is increasing, and future performance may become more differentiated, with investors making more refined judgments about value.
