The crypto fear and greed index recently reached a neutral level of around 51, indicating uncertainty among investors about the market’s direction. This comes after a significant $7 billion drop in the value of Solana over 7 days, leading to questions about the continuation of the crypto bull run. The ongoing downward trend in the market is consistent with this sentiment. Despite the recent market volatility, the total cryptocurrency market cap has increased by over 35% year-to-date (YTD).
This growth surpasses the 15% increase seen in the S&P500 index during the same period. This suggests a potential interest from investors and traders in purchasing assets at lower prices, also known as “buying the dip.” Additionally, the economic control measures implemented by the Federal Reserve should be considered as a factor influencing market trends. While some believe that ETFs tracking spot prices will have a positive impact on the on-chain ecosystem, others, particularly decentralized finance (defi) proponents, remain unconvinced.
With block rewards halved and growing demand for spot Bitcoin ETFs, there are concerns about a potential shortage of Bitcoin to meet future buying pressure. As a result, analysts predict that this could drive prices higher in the future.