The crypto market has entered a deep state of fear, with sentiment collapsing sharply over the past week.
Key Takeaways:
Crypto sentiment plunged into Extreme Fear, with Alternative.me’s index dropping to 22. Bitcoin struggled near $110,000 amid renewed US–China trade tensions. Long-term holders sold 265,700 BTC in the past month, while overleveraged traders faced $418 million in liquidations.According to Alternative.me’s Fear & Greed Index, market sentiment fell to 22, Extreme Fear, down from 64 (Greed) just one week ago.
Meanwhile, CoinMarketCap’s Crypto Fear and Greed Index also dropped to 28 (Fear) from 54 (Neutral) last week, signaling widespread caution among traders.
Bitcoin Stalls at $110K as US–China Tensions Spark Flight to Gold
The rapid shift in sentiment mirrors growing unease across global markets.
Bitcoin hovered just above $110,000 on Thursday, struggling to hold key support as renewed US–China trade tensions dampened risk appetite.
The flight to safety was underscored by gold hitting new record highs above $4,230 per ounce, signaling investor preference for traditional safe-haven assets.
Meanwhile, exchange-traded fund (ETF) data showed sustained outflows. U.S. spot Bitcoin ETFs saw withdrawals of $94 million on Wednesday, extending a multi-day streak of redemptions.
Derivatives data also pointed to mounting selling pressure, with total liquidations surpassing $418 million over the past 24 hours.
Long positions outnumbered shorts by more than 2.4 to 1, suggesting that many leveraged traders were caught off guard as prices retreated.
On-chain data paints an equally cautious picture. Long-term holders, wallets with coins held for over 155 days, have sold roughly 265,700 BTC in the past month, the largest such outflow since January.
Analysts interpret this as profit-taking amid heightened volatility, a signal that even veteran investors are trimming exposure.
“The move reflects rising caution among veteran holders amid volatility, painting a bearish scenario for the cryptocurrency,” said Milad Azar, Market Analyst at XTB MENA.
As reported, Bitcoin may be nearing a critical turning point, according to trader Tony “The Bull” Severino, who believes the next 100 days could determine whether the cryptocurrency enters a parabolic rally or ends its current bull cycle.
Severino pointed to the Bollinger Bands indicator on Bitcoin’s weekly chart, which has tightened to levels unseen before, often a precursor to sharp price moves in either direction.
Severino cautioned that “head fakes,” or false breakouts, are common during such setups. He noted Bitcoin recently failed to break above the upper band with strength after briefly touching $126,000, suggesting a potential dip before any sustained rally.
BitMEX Chair Says Ethereum Could “Flip” Bitcoin Like Equities Overtook Gold After 1971
Ethereum could eventually surpass Bitcoin’s market share, similar to how U.S. equities overtook gold following the end of the gold standard in 1971, according to BitMEX chair Tom Lee.
Speaking with ARK Invest CEO Cathie Wood, Lee compared Ethereum’s potential rise to the shift that occurred after the “Nixon Shock,” when the US dollar became fully synthetic and unpegged from gold.
Lee noted that the move away from gold created massive demand for financial products tied to the dollar, paving the way for Wall Street’s dominance.
“The market cap of equities today is $40 trillion compared to $2 trillion for gold,” he said, highlighting how financial innovation transformed the dollar’s role globally.
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