The Fear and Greed Index has now bottomed out, seeing its lowest level since the crypto crash in the heat of last year’s COVID-19 lockdown. On March 12 and 13, 2020, the index crashed to 14 and 10, respectively. On March 17 and March 26, the index bottomed to 8. However, as of May 20, the index had risen to 11, still lower than last year’s bottom.
In recent times, Bitcoin has reacted negatively to tweets by Elon Musk and also China’s on banks from using crypto. On May 19, China banned banks and other related financial institutions from providing crypto-related services. The ban includes registration of clients, crypto trading, clearing, and also settlements.
The Chinese government referred to the instability of cryptocurrencies as “…seriously infringing on the safety of people’s property and disrupting the normal economic and financial order.” After this comment at the already-staggering crypto market, Bitcoin fell as low as $30,000.
Elon Musk further aggravated the state of things some days later, in reply to a tweet that that Tesla would “dump the rest of their Bitcoin holdings.” Musk insinuated that the statement could be true by replying, “Indeed.” This caused Bitcoin to plunge further, before Musk cleared the air, that “Tesla has not sold any Bitcoin.”
At the moment, the Index at 11, based on the losses in the market two days ago. In terms of percentage, the losses from last year were more significant as Bitcoin fell over 50%, from $8,000 t0 $3,800. But in monetary terms, the losses are far greater than last year. Bitcoin lost $70 billion in market value and is currently trading just a little above $40,000.