Follow Us "Bitcoin Slumps Below $85K Dragging Crypto Fear Index To 3-Year Low – Analyst Still Sees $200K Ahead")
synopsis
After a 22% drop from its all-time high, Bitcoin has entered bear market territory. Traders blame the $1.46 billion ByBit hack for the sell-off.
Bitcoin (BTC) continued its decline during U.S. market hours on Thursday, with the Crypto Fear & Greed Index plunging to its lowest level in nearly three years.
According to CoinGecko data, the apex cryptocurrency fell 2.4% on the day and has lost over 13% for the week. Bitcoin’s price went as low as $82,500 on Wednesday after U.S. President Donald Trump doubled down on tariffs against Canada and Mexico.
Due to begin on March 4, these “will, indeed, go into effect, as scheduled,” Trump wrote in a post on Truth Social.
Amid the increased volatility, investor sentiment has turned increasingly pessimistic, with the widely followed index registering an ‘Extreme Fear’ reading of 10 out of 100.
This marks the lowest level since mid-2022, when the collapse of Terraform Labs and hedge fund Three Arrows Capital sent shockwaves through the digital asset market.
With a 17.5% decline, February is on its way to being the worst month for Bitcoin since June 2022.
Retail sentiment on Stocktwits has also deteriorated, flipping to ‘bearish’ from ‘bullish’ earlier this year.
According to platform data, Bitcoin saw the biggest uptick in retail chatter among cryptocurrencies in the last 24 hours as the apex cryptocurrency dipped to lows last seen in November, a whisker above its 200-day simple moving average (SMA).
Some traders speculated that Bitcoin’s recent selloff was exacerbated by ByBit’s $1.46 billion hack, the largest in crypto history, which may have forced exchanges to liquidate positions to prevent further fallout.
Despite the downturn, some analysts remain bullish. Geoffrey Kendrick, head of digital assets research at Standard Chartered, told CNBC that Bitcoin could still reach $200,000 this year and climb to $500,000 in the longer term.
He attributed his optimistic outlook to growing institutional adoption, which he believes will stabilize the industry over time.
“As the industry becomes more institutionalized, it should be safer,” Kendrick said, adding that fewer high-profile hacks – like the one suffered by ByBit – should help reduce market volatility.
Bitcoin is now trading 22% below its all-time high of nearly $109,000 in late January, placing it in a bear market.
A 20% decline from the latest peak is the technical definition of a bear market, marking a stark reversal for an asset breaking records just a month ago.
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