Bitcoin Sentiment in US Recovery After the FTX Meltdown (Analysis)

Bitcoin Sentiment in US Recovery After the FTX Meltdown (Analysis)

[ad_1]

The bitcoin premium on Coinbase was deep in a negative state for weeks after the collapse of once the third-largest cryptocurrency – FTX.

However, positive signs coming from the metric’s reversal suggest that US investors could have changed their game plan. At the same time, the Bitcoin Fear and Greed Index has also climbed out of its most desperate state.

BTC Coinbase Premium Flashes Green

November 2022 turned out to be one of the most eventful months in the young industry’s history that saw one of its giants – FTX – as well as all of its affiliates go from hero to zero days. The loud collapse of the former SBF empire echoed in and outside of crypto, harming countless related companies in the process. Even Wall Street giants, as well as state-backed entities, had exposure to the fallen crypto exchange.

Somewhat expectedly, crypto asset prices fell hard. Bitcoin, for one, dumped from over $21,000 to a two year low of $15,500. As investors were rushing to get their holdings out of exchanges or simply sell them at every cost, the Coinbase premium – a metric typically used to determine the general sentiment of large (sometimes institutional) US investors – plummeted into deep negative territory.

According to CryptoQuant’s CEO, though, the tides have begun to change. The metric has bounced off of its multi-year low, which eclipsed July bottomand has actually shown the first signs of positive premium in weeks.

Fear and Greed Takes a Breath of Fresh Air

Another metric that provides the general sentiment towards bitcoin and the entire industry is the BTC Fear and Greed index. Basing the results of surveys, social media comments, price movements, etc., the final results range from 0 (extreme fear) to 100 – (extreme greed.)

Expectedly, it has not seen “greed” or “extreme greed” in many months. As most prices are around 75-90% from their respective peaks charted last year, the index has been under 50 for most of 2022. The FTX collapse and subsequent price dumps drove it down to “extreme greed” once again.

Similar to the Coinbase premium, though, the Fear and Greed has climbed out of its most unfavorable state and is currently in just “greed.” at 27. This coincided with BTC’s price pump to and beyond $17,000, as well as the speculations that this bear cycle could end soon.

Bitcoin Fear and Greed Index.  Source: Alternative.me
Bitcoin Fear and Greed Index. Source: Alternative.me
SPECIAL OFFER (Sponsored)

Binance Free $100 (Exclusive): Use this link to register and receive $100 free and 10% off fees on Binance Futures first month (terms).

PrimeXBT Special Offer: Use this link to register & enter POTATO50 code to receive up to $7,000 on your deposits.



[ad_2]

Source link

Leave a Comment