Bitcoin's Fear and Greed Index dropped to its lowest position in three months, entering extreme fear for the first time since August. The slide follows a $10,000 price decline in 20 days, driven by a Binance hack, US midterm results and a Wall Street crash.
The Bitcoin Fear and Greed Index tumbled to 25 for the first time since August 5, according to Alternative.me data. The reading marks the lowest position in three months.
Bitcoin nosedived by $10,000 in 20 days, and investor sentiment followed the price down.
How the index measures sentiment
The index runs from 0 (extreme fear) to 100 (extreme greed). It gathers data from several sources, including market volatility, market momentum and volume, social media bias, and BTC's dominance over altcoins. Surveys were included in the past but have been paused.
Since price moves are one of the main sources, the metric rose above 70 in late August and mid-September, close to extreme greed territory. Bitcoin then peaked at $87,000 in September and fell in the following month and a half.
A string of shocks pushes Bitcoin lower
The metric was still above 60 in late October, when Bitcoin briefly jumped to $85,000. Then came the Binance hack, which drove the asset from $81,000 to $76,000.
Bitcoin rebounded in the following days, but the US midterm results came next, followed by the Wall Street crash on Thursday. On Friday, the asset slipped to $74,800, its lowest level since the August breakout, before rebounding to $76,000.
The source notes that the last time the index was this negative, BTC broke out.
Source: CryptoPotato
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