The Crypto Fear and Greed Index — a tool that measures broader market sentiment towards Bitcoin and the broader crypto market — has dipped to a level of “fear” not witnessed since March 11 this year, when Circle’s USD coin (USDC $1.00) briefly lost its dollar-peg. 

The stumble in market sentiment comes in the wake of the United States Securities and Exchange Commission (SEC) filing a lawsuit against Binance, its U.S. arm of operations and its CEO Changpeng Zhao.

The SEC pressed a total of 13 charges against the exchange and its affiliates for failing to register as a securities exchange and operating illegally in the United States.

Chart

The Bitcoin Fear and Greed Index. Source: Alternative.me.

The index works by aggregating a mixture of indicators to gauge market sentiment. It combines metrics including price volatility, momentum, trading volume with data from social media and Google trends to form an overall picture of investor’s emotions towards Bitcoin and the wider crypto market.

Much of the negative sentiment owes to the immediate plunge in the value of cryptocurrencies following the SEC’s latest move against Binance. Blue-chip crypto assets such as Bitcoin and Ethereum (ETH $1,817) are down 4.1% and 3.1% respectively in the last 24 hours according to data from Cointelegraph Price Index.

The larger altcoins also took a beating. At the time of publication, Cardano (ADA $0.351) is down 6.4% in the last 24 hours while Solana (SOL $20) has fallen 7.4%.

Traders with open positions on crypto derivatives markets also suffered consequences, with more than $280 million worth of liquidations occurring since the announcement of the lawsuit.

Chart

Total liquidations in the past 12 hours. Source: Coinglass.

Unsurprisingly, traders with open “long” positions — a leveraged bet on the price of crypto assets increasing — were the hardest hit, accounting for $261.75 million (92%) of the overall liquidations. Meanwhile, short traders experienced $20.7 million in liquidations. The top two digital assets were responsible for around 43% of these losses.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Join Telegram

Recommended content


Recommended Content

Editors’ Picks

NEAR protocol could see a rally as it sets out to launch an AI smart contract builder

NEAR protocol could see a rally as it sets out to launch an AI smart contract builder

Near protocol (NEAR) co-founder Illia Polosukhin stated in a social media post on Wednesday plans for NEAR to launch NEAR AI, a user-owned AI system that will allow users to build web3 apps without code on an end-to-end network.

More Near News

US House of Reps passes bill aiming to regulate cryptocurrencies

US House of Reps passes bill aiming to regulate cryptocurrencies

FIT21 bill received massive support as the House of Representatives voted to pass the bill on Wednesday. The White House and US Securities & Exchange Commission (SEC) Chair, Gary Gensler, expressed concerns about the potential impact of the FIT21 bill on investor protections in a statement.

More Cryptocurrencies News

Ethereum bulls await ETF approval as BlackRock, Bitwise, Grayscale submit amended ETH ETF filings

Ethereum bulls await ETF approval as BlackRock, Bitwise, Grayscale submit amended ETH ETF filings

Ethereum (ETH) is trading sideways on Wednesday as BlackRock, Bitwise and Grayscale submitted their amended 19b-4s filings to the Securities & Exchange Commission (SEC). The agency has also begun conversations with issuers on S-1s applications.

More Ethereum News

As Ethereum spot ETF approval nears, these altcoins could explode

As Ethereum spot ETF approval nears, these altcoins could explode

It is not surprising that altcoins related to Bitcoin saw a major rally post-Bitcoin spot ETF approval. Likewise, tokens closely related to Ether could ride the ETF approval wave. Ethereum Classic, Pepe, Floki and other DeFi tokens could gain momentum as the ETH ETF approval deadline nears. 

More Cryptocurrencies News

Bitcoin: Is BTC out of the woods? Premium

Bitcoin: Is BTC out of the woods?

Bitcoin price shows signs of continuing its uptrend, providing a buying opportunity between $64,580 to $63,095. On-chain metrics forecast a bullish outlook for BTC ahead. If BTC clears $70,000, the chances of resuming the uptrend would skyrocket.

Read full analysis

BTC

ETH

XRP