The recent decline in Bitcoin prices has impacted the sentiments of cryptocurrency traders significantly. The Crypto Fear and Greed Index, a metric that gauges the emotional state of the crypto market, has dropped to 43, marking its lowest point since last October.

This shift has moved the index from the “greed” zone, where it stood just a week ago, to the “fear” zone, indicating a rise in investor anxiety. Fear is represented on the scale by values ranging from 26 to 46, suggesting a bearish sentiment prevailing at these levels.

The ongoing capital outflows from U.S. spot ETFs are exerting pressure on the market. In May, the net outflow from the spot Bitcoin ETF reached a record $564 million, the highest since its launch in January.

Despite these challenges, analysts from Santiment maintain an optimistic outlook on BTC’s future price. They attribute the recent market correction to the anticipated growth in Bitcoin’s capitalization leading up to the halving event. Following the halving in late April, investors engaged in a pattern of buying based on rumors and selling upon confirmation of news.

Analysts point to the surge in the Bitcoin market between October 2023 and early spring 2024, driven by heightened expectations surrounding the halving. However, individuals who purchased BTC at its peak in late March are currently facing losses.

For more updates and insights on the cryptocurrency market, stay tuned to Global Crypto News.

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