Given the price performance over the past week, crypto market sentiment is currently on a downward trend
As of Friday, 18 February, the Crypto Fear & Greed Index has once again fallen below 30, bottoming out yesterday at 20. A week ago, it was in the Neutral zone at around 50.
Bitcoin’s week
Trovio Capital Management’s Head of Trading and Research, Will Hamilton, points out that last week seemed quiet, but it ended with the price of Bitcoin breaking support at $40,000, falling well below $37,000 and then climbing back up to $38,000. The problem, of course, is the uncertainty that is currently reigning supreme in the markets due to fears of an extended conflict in Eastern Europe, and macroeconomic uncertainties.
Hamilton also points out that the correlation with Ethereum remains high, as does the correlation with the total capitalization of the crypto market.
Extreme Fear
In such a scenario, the Fear & Greed Index dropped back to the “Extreme Fear” level and has remained there for now.
However, it is also worth mentioning that a month ago it was even lower, with the price of Bitcoin falling well below $35,000. So the current situation is one of strongly negative sentiment, but not at record levels.
After all, the historical bottom line at the moment would indicate a price of $35,500, so the current level is still much higher.
In the meantime, positive news about technology and the use of Bitcoin continues to emerge.
Bitcoin against financial censorship in Canada
In Canada, for example, Prime Minister Justin Trudeau invoked the Emergencies Act for the first time and amended the country’s policy on terrorist financing to include cryptocurrency donations to the current blockades. The police then also issued an order to all FINTRAC-regulated companies asking them to cease Bitcoin transactions allegedly associated with fundraising for the Freedom Convoy.
The fact is that such transactions cannot be blocked even by governments, if done through non-custodial wallets, so the case for using Bitcoin as a protection against financial censorship has been widely revealed to the general public and proven.
Legalization of cryptocurrencies in Russia
In addition, Russia’s Ministry of Finance is pursuing a plan to regulate cryptocurrencies in the country, and has already submitted a bill to parliament. The new legislation aims to create legal markets for digital assets, and could be approved as early as this week.
Source: https://en.cryptonomist.ch/2022/02/23/crypto-market-sentiment-is-on-the-decline/