Crypto sentiment index plummets to 50 as Bitcoin falls below $92K

The Crypto Fear Greed Index has experienced a significant drop, falling 19 points to a score of 50, marking its lowest level since October 14.

This decline in sentiment comes as Bitcoin's (CRYPTO:BTC) price dipped below $92,000 on January 9.

The index had remained in the "Extreme Greed" and "Greed" zones for three months prior to this shift into the "Neutral" zone.

Analysts attribute this downturn to several factors, including a report that the U.S. Department of Justice is authorised to sell $6.5 billion worth of Bitcoin seized from Silk Road, although no sales have occurred yet.

Additionally, expectations of tighter monetary policy from the U.S. Federal Reserve in 2025 have raised concerns about potential impacts on Bitcoin and the broader cryptocurrency market.

Markus Thielen, founder of 10x Research, noted that the recent outflow from U.S. spot Bitcoin exchange-traded funds (ETFs) — nearly $570 million on January 8 — signals that Bitcoin may retrace further.

The Crypto Fear Greed Index is calculated based on various factors including market volatility, trading volume, social media sentiment, Bitcoin's dominance, and market trends.

Previously, the index reached a high of 94 out of 100 on November 22, reflecting positive market responses to Donald Trump's presidential election victory and speculation about a potential U.S. Bitcoin reserve strategy.

As market dynamics continue to evolve, investors are closely monitoring these sentiment shifts and their implications for future price movements in the cryptocurrency space.

At the time of reporting, the Bitcoin (BTC) price was $94,675.41.