The Crypto Fear & Greed Index has plummeted to an ‘extreme fear’ reading of 9, echoing levels last seen during the FTX collapse, as monitored globally on February 6.
The significant drop signals heightened investor anxiety impacting major cryptocurrencies, notably Bitcoin and Ethereum, with price declines and liquidity outflows prompting caution amidst ongoing market volatility.
Crypto Fear Index Plummets to 9 Amid Market Turbulence
Bitcoin and Ethereum prices fell by 4.2% and 5.8%, respectively, during the past 24 hours. This drop aligns with the fear index shift, influencing market liquidity and investor confidence. Trading volumes have noticeably decreased.
Experts suggest potential financial ramifications as on-chain metrics reveal liquidity outflows. Historical patterns point to brief market recoveries following such fear spikes. Regulatory bodies have yet to comment on the sentiment-induced market shifts.
Bitcoin and Ethereum Prices Drop by Over 4%
Historical precedents occur during the FTX and Terra/LUNA crashes, with the fear index similarly low. However, recovery times varied. Both incidents saw broad market impacts and pressure on DeFi liquidity.
Analysts from Kanalcoin suggest that market resilience remains despite acute fear. Drawing from past corrections, there may be investment opportunities amid market rebounds. Continued scrutiny of trading patterns remains essential for stakeholders.
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