Market sentiment shows that crypto investors have renewed their optimism and confidence in BTC, as the world's largest cryptocurrency continues to flirt with the $31,000 mark.
According to the Fear and Greed Index, a popular tool used to measure general sentiment, greed has taken over the market as investors get too comfortable with Bitcoin at its current price.
Greed takes over
The Fear and Greed Index assesses market sentiment by analyzing key factors, including volatility, market momentum, social media trends, and bitcoin dominance. It uses a scale of 0 to 100, where 0 represents "extreme fear" and 100 means "extreme greed."
During the past week, the greed index it has steadily risen above 50, peaking at 64, coinciding with Bitcoin price breaking above $30,000.
The rise in greed in the market is fueled by several factors, including institutional BTC hoarding, two consecutive green rooms, and positive on-chain metrics.
Institutional Waves of Bitcoin Accumulation
One of the main drivers of the resurgence of greed in the cryptocurrency market is the exponential increase in the institutional accumulation of Bitcoin.
In recent months, prominent institutional players, including major financial institutions and corporations, have been actively acquiring bitcoins as part of their investment strategies. according to blockchain analytics firm CryptoQuant.
This wave of institutional adoption validates bitcoin as a store of value while signaling institutional confidence in its long-term potential. The strategic move by institutional investors to accumulate BTC is based on the belief that the crypto asset can act as a hedge against inflation and provide diversification in traditional investment portfolios.
Institutional accumulation has also contributed to the positive sentiment surrounding bitcoin and has drawn the attention of retail investors looking to capitalize on the growing institutional interest.
2 consecutive green rooms ignite optimism
Bitcoin's recent milestone of destination two consecutive green quarters for the first time since 2021 has further fueled optimism among investors. After a period of market uncertainty and bearish sentiment over the past year, bitcoin's back-to-back positive quarterly results signify a potential change in market dynamics.
Back-to-back green quarters demonstrate BTC's resilience as it navigates through the bear market and emerges stronger. This achievement has instilled confidence in investors, indicating a possible turnaround in the market. The bullish sentiment resulting from the milestone has ignited renewed greed among market participants.
Investor behavior points to a bull run
Beyond institutional accumulation and two consecutive positive quarterly performances, on-chain metrics and investor behavior provide further evidence of a possible bull run in the crypto market.
According to the latest Bitfinex weekly reportOn-chain data such as Bitcoin's Spent Out Profit Ratio (SOPR) and Net Unrealized Profit and Loss (NUPL) indicators show that almost all bitcoin transactions have been profitable since the crypto asset topped the $29,500.
Investor behavior also reflects a growing appetite for risk and the potential for substantial returns. The report noted that traders are confident in their spot position as they are unwilling to sell at a loss.
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