The Crypto Fear and Greed Index, a metric tracking crypto investor sentiment, flipped to neutral on Sunday, for the first time since October, signaling that investor sentiment is improving. The Index is at 40, signaling that investors are no longer fearful, but they are not bullish on the crypto market either. The price of Bitcoin rose to an all-time high above $125,000 days before the crash, then fell to about $80,000—a roughly 35% drop. Altcoins fared worse, with many tokens shedding the majority of their value overnight, and the total crypto altcoin market cap, excluding ETH and BTC, plummeted by about 33% in a single day.
The sentiment among crypto investors improved from the extreme fear that characterized the end of 2025, signaling hope for the start of 2026, but growing geopolitical tensions and a lack of retail interest could be headwinds in the new year. All eyes are on the US following the strike on Venezuela, which occurred on Saturday, raising questions about the potential impact on financial markets. The shift suggests investors are no longer driven by fear, though they remain cautious about near-term momentum. The narrative is underpinned by Bitcoin’s price action, which surged above $125,000 days before the downturn before retreating to around $80,000, a roughly 35% decline.
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