Crypto community gripped by pessimism
The collapse of Bitcoin to around $60,000 coincided with the Crypto Fear & Greed Index reaching its lowest level since mid-2022, when the Terra ecosystem crashed.
The Fear & Greed Index is a metric that assesses the mood of crypto investors on a scale from 0 to 100. A value below 25 is considered 'extreme fear', while above 75 is 'extreme greed'. So the current index level of 19 indicates a predominance of pessimism in the market.
The main reason for the decline in investor sentiment was the tightening of the US Federal Reserve's monetary policy and the slowdown in the growth of major economies, which negatively impacted the value of risky assets, including cryptocurrencies.
Outlook for the crypto market
Despite the current difficulties, most experts maintain a moderately optimistic view on the long-term prospects of the cryptocurrency market. In their opinion, the current negative sentiment creates favorable conditions for investors with a long-term horizon to accumulate positions.
At the same time, analysts warn that further correction of cryptocurrency prices is possible in the coming months, especially if the Fed continues to tighten monetary policy.