June 25, 2021

Bitcoin Plummets 30% as “Extreme Fear” Sets in on Crypto Markets

2 min read

The Crypto Fear and Greed Index, a metric that’s known to measure current market sentiment, was up to its lowest point of 2021. The index, which has continued to fall together with Bitcoin rates, hit “severe fear” levels, which have not been observed considering that April 2020 during the global financial market crash.

Bitcoin(BTC/USD)prices visited more than 40%in March 2020 throughout the

stock market crash. Because rallying more than 200%in 2021, the major cryptocurrency appears to be withdrawing comparable levels. Source: Tradingview.com The metric has continued to show the bearish sentiment that appears to have actually surpassed the crypto markets. As Bitcoin extended its losses and briefly hit $31,600 today, the indication collapsed to a record-low rating of 11.

News of Tesla declining Bitcoin payments previously last week turned the marketplaces sour — — resulting in a massive broad market drawdown.

Sometimes of composing, Bitcoin is down 27.63% in a single week, with Ethereum, Binance Coin and Dogecoin down 41.83%, 50.32%, and 26.60%, respectively.

Simply earlier last month, the metric indicated that the crypto market was greatly overheated, with a ranking of 73, or “Greed.” Up to that point, Bitcoin was up by more than 200% YTD.

Bitcoin Short Term Volatility Also at Record Levels

Short-term volatility also reached the greatest level seen considering that last February. According to the Bitcoin Volatility Index, monthly volatility rose to 4.64%.

Sadly, it’s most likely that volatility is here to remain. According to Deribit Metrics, historical volatility for the options market rose to 131%, up from 67% just a week prior.

The contract with the greatest notional value and volume are May 28 50,000 puts, which are already in-the-money. With more than $1.6 billion worth of agreements set to expire by the end of May, there’s no doubt that Bitcoin will continue to deal with choppy rate action.

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