Bitcoin greed index plummets to ‘neutral’ as ETFs fail to buoy prices

The Crypto Fear Greed Index has just plunged back to “neutral” levels last seen in October 2023, just days after the historic approval of spot Bitcoin. ( BTC ) exchange-traded funds (ETFs) in the United States.

According to the index, Bitcoin’s market sentiment score  is currently 52 out of 100 — its lowest score since Oct. 19, 2023, when it traded for an average daily price of roughly $31,000. 

The switch comes less than a week after the Crypto Fear Greed Index briefly tipped into an “extreme greed” score of 76 when the market was anticipating the approval of spot Bitcoin ETFs . 

The index gathers and weighs data from six market key performance indicators to score market sentiment each day: volatility (25%), market momentum and volume (25%), social media (15%), surveys (15%), Bitcoin’s dominance (10%) and trends (10%).

While Bitcoin surged as high as $49,000 in the 24 hours following the U.S. Securities and Exchange Commission’s decision to approve spot Bitcoin ETFs, Bitcoin fell as low as $41,500 by Jan. 12 as traders locked in profits.

Bitcoin has since leveled out slightly and is changing hands for around $42,200 at the time of publication, according to data from TradingView. 

Related: Bitcoin price sells-off after ETF approval — Have investors turned bearish?

Meanwhile, there has been uncertainty around spot Bitcoin ETFs since their launch, with conflicting data about their performance and a lack of information concerning the more granular details of the new investment vehicles. 

1/ A on why reported BTC ETF flows are incorrect.

There are multiple rabbit holes to jump down. First, let’s point out why the reported flows appear off. Looking at the table from @EricBalchunas (I’m trusting it’s accurate), we can see multiple examples where volume is pic.twitter.com/B2CPYD6VZo

— TardFiWhale.eth (@TardFiWhale) January 14, 2024

According to Google Trends, searches for “Why is Bitcoin dropping?” have surged 1,100% as market participants look for the meaning of recent Bitcoin price action.

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