June 25th, the price of Bitcoin (BTC) fell below the psychological level of $60,000 for the first time since early May, and the Fear and Greed Index for cryptocurrency plummeted to its lowest level in nearly 18 months. The index measures market sentiment for BTC and other parts of the cryptocurrency market, and it fell 24 points on June 24th, marking the largest single-day drop in years and causing the index to plummet to a “fear” zone with a score of 30. Since then, it has rebounded slightly and now stands at 46. A value of 0 represents “extreme fear,” while a value of 100 represents “extreme greed.”
The decline in the Fear and Greed Index for cryptocurrency coincides with a significant correction in BTC’s market.
On June 24th, BTC fell to a seven-week low of around $58,400. However, as of 2:40 AM Eastern Time, the index has slightly recovered, with a trading price of $61,539.02. Despite this increase, BTC still experienced a decline of over 6% in the past 7 days, according to CoinMarketCap data.
Several factors have contributed to the selling pressure on BTC entering the rankings. Over the past two weeks, over $1 billion has flowed out of Bitcoin’s spot ETF (exchange-traded fund). Meanwhile, investors are preparing to liquidate the $8.5 billion worth of BTC from the now-defunct Mt. Gox exchange.
More than a decade after its collapse, the rehabilitation trustee of the exchange announced plans to start repaying BTC and BCH to 127,000 creditors of Mt. Gox in July.
The recent decline in BTC is part of a larger bear market.
While investors are concerned about how BTC will cope with the impending Mt. Gox selloff, some analysts believe that BTC’s recent decline is part of a long-term macro bullish trend. Pseudonymous trader and analyst Rekt Capital stated in a post on June 25th, “Bitcoin’s pullback is completely to form a macro higher low.” He added, “Bitcoin is likely forming a macro bull market at this price level.”
