On Friday, the Crypto Fear & Greed Index fell into neutral territory. It’s drop down to a score of 54 out of 100, according to alternative.me. This change reflects the important shift in market sentiment from “Greed” to “Neutral.” That tells us that investor enthusiasm is likely starting to cool. Data shared by Santiment indicates that large Bitcoin holders are acting in contrast to retail investors. This divergence further complicates an already challenging market environment.
At the time, the Crypto Fear & Greed Index was averaging 61, or “Greed,” from June 9 to June 15. Just last month, that same index averaged 70, a number that indicates “Greed.” Santiment’s Crypto Fear & Greed Index is typically a bullish signal. As I recently wrote, anecdotally, historically, retail just really can’t stand on the right side of markets in general.
Whale Accumulation Amidst Retail Sell-Off
Santiment, an on-chain cryptocurrency market analysis platform, recently reported a high level of divergence in the behavior of crypto holders. Their data is sourced from insights.santiment.net. Now, in the last 10 days, they have figured out that there are 231 new wallets that have each added over 10 Bitcoin. This indicates that big money investors are intentionally and strategically boosting their holdings at this time.
More than 37,000 wallets with under 10 BTC have sold their holdings in that same period. Smaller holders are liquidating themselves into insolvency, cashing out their assets. They may be motivated by concerns about additional price drops or a shift in their investment strategy.
"When large wallets accumulate as retail loses confidence, this is historically the right combination for bullish momentum to inevitably return to crypto markets" - Brian Quinlivan, Santiment Marketing Director
Bearish Sentiment Among Traders
Santiment’s analysis goes further than just looking at accumulation and selling patterns. Utilizing its Sanbase platform, Santiment measures trader sentiment from multiple social channels including Telegram, Discord, Reddit, and X (formerly Twitter). Their results illustrate an increasing feeling of impatience and pessimism among traders.
"crypto in a bit of a lull, traders are showing signs of impatience & bearish sentiment" - Brian Quinlivan, Santiment Marketing Director
"there are just 1.03 bullish comments for every 1 bearish comment, which hasn’t happened since peak FUD during initial tariff reactions on April 6" - Brian Quinlivan, Santiment Marketing Director
Santiment notes that this bearish sentiment is in stark contrast to the accumulation activity exhibited by larger wallets. This discrepancy is indicative of a very bullish market.
Potential for Market Rebound
Santiment’s data suggests that retail fear toward Bitcoin is on the rise. All bearish sentiment and present market lows aside, this trend points toward a positive redemptive crypto comeback. This is rooted in the long-standing principle that markets usually go the other way when retail is calling for a move.
Bitget operating chief Vugar Usi Zade told Cointelegraph that retail trading has shifted away from rampant speculation and toward more practical and sustainable use cases. Such a shift may be a sign of a maturing market that is less reactive to knee jerk behavior.
