July 20, 2024


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Low Volatility Crypto Market Supplies Surprisingly Stable State Of Fear

2 min read

Data shows the crypto market has remained in a state of extreme fear recently despite the Bitcoin volatility being quite low.

Crypto Fear And Greed Index Continues To Point At “Extreme Fear”

As per the latest weekly report from Arcane Research, investors in the cryptocurrency sector have remained extremely fearful since late August.

The “fear and greed index” is an indicator that tells us about the current sentiment among participants in the crypto market.

The metric makes use of a numeric scale that runs from zero to hundred for representing this sentiment. All values above 50 mark periods of greed, while those below the threshold suggest fear among the investors.

At values towards either end of the range, that is those above 75 and below 25, occur mentalities of “extreme greed” and “extreme fear.”

Now, here is a chart that shows the trend in the crypto fear and greed index over the last year.

Crypto Fear And Greed Index

The value of the metric seems to have not changed much in recent days | Source: Arcane Research's The Weekly Update - Week 39, 2022

As you can see in the above graph, the crypto fear and greed index has a value of 20 at the moment, implying the market is extremely fearful.

This is a continuation of an extreme fear streak that started more than one month ago, back during late August.

Historically, investors have usually maintained fearful sentiments during periods of high volatility in coins such as Bitcoin, while stretches of low volatility have accompanied times of greed.

However, while this recent run of extreme fear took place, the price of BTC mostly stayed constant around the $19k mark. The below graph shows how unusually low the volatility has been for the coin recently.

Bitcoin Crypto Volatility

Looks like the Bitcoin volatility has plunged down in the past week | Source: Arcane Research's The Weekly Update - Week 39, 2022

The report notes that the crypto market investors having such a rock-bottom sentiment while the BTC volatility has also been low suggests there is an innate fear among the participants that the worst of the bear market hasn’t passed over yet.

BTC Price

At the time of writing, Bitcoin’s price floats around $20k, up 5% in the past week. Over the last month, the crypto has gained 1% in value.

The below chart shows the trend in the price of the coin over the past five days.

Bitcoin Price Chart

The value of the crypto seems to have shot up over the last couple of days | Source: BTCUSD on TradingView
Featured image from Rudi De Meyer on Unsplash.com, charts from TradingView.com, Arcane Research

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