CoinGecko Analyzes Six-Year Evolution of Crypto Market Sentiment

From 2018 to 2024, market participants in digital assets were dominated by fear 54.7% of the time, greed 32%, and a balance between extremes was observed 13.3% of the time, according to calculations by CoinGecko.

How has the crypto market sentiment evolved in the past 6 years?

Our study shows that the sentiment has been:

? Fearful — 55% of the time
? Greedy — 33% of the time
⚪ Neutral — 13% of the time

Read the full study: https://t.co/r1B7KD8f2l pic.twitter.com/9q1qhC7Tzg

— CoinGecko (@coingecko) March 7, 2024

During the period under review, the fear and greed index averaged 45 points, bordering between a neutral state and a sense of anxiety.

In other words, periods of euphoria were shorter than those of panic and negativity. Optimists’ expectations are naturally shorter-term than those of pessimists.

Analysts explained that the results could have been influenced by the predominance of bear markets.

From November 2023 to February 2024, the index remained in the optimism zone. This trend was the longest in history. The upcoming halving in April could change it.

A similar situation to the current one was observed during Bitcoin’s rise to ATH from November 2020 to February 2021, when the price of digital gold first surpassed $40,000.

During the bear market of 2018–2019, the index recorded the second and third longest durations of sustained presence in one of the zones.

During that period, the indicator pointed to a predominance of anxiety among traders on 288 out of 334 days (86.2%), with fear reaching extreme levels 42.2% of the time. The leitmotif was the market capitalization crash from $0.85 trillion to $0.13 trillion following the ICO bubble burst.

In 2019, anxiety prevailed on 216 out of 365 trading days (59.2%). The period was marked by a steep drop in the index from 61 points to 16 points in just one day (July 14).

That year also saw a moderate market recovery. As a result, the indicator recorded 121 days of greed (33.2%).

In 2020, sentiments were more balanced — 39.1% euphoria and 46.2% panic. This combination resulted from market consolidation and sequential recovery.

In 2021, investors experienced the most optimistic sentiments. The index entered the greed zone on 199 out of 365 days (54.5%). There was also a sharp one-day jump in the metric by 40 points — from 39 points to 78 points (March 1).

That year, capitalization soared from $0.78 trillion to $2.31 trillion, and Bitcoin reached a previous record of $69,000. Euphoria characterized 96.7% of the first quarter of 2021.

2022 was the complete opposite of the previous year: pessimism prevailed on 343 out of 365 days (94%). Extreme fear dominated for 207 days. That year saw only three days of optimism. The NFT hype did not affect overall sentiments.

The digital asset advertising boom at the Super Bowl in the first quarter did not change the situation. In the second quarter, it was exacerbated by the Terra collapse, followed by industry “contagion” and culminating in the FTX collapse in November. As a result, the fourth quarter did not see a single day when traders could escape a state of anxiety.

In 2023, sentiments stabilized, with 137 days (37.5%) being neutral. Greed was characteristic of 165 days (45.2%), and fear of 63 days (17.3%).

Earlier in February, CoinGecko analysts identified the best time to sell airdrop tokens.