The Crypto Fear & Greed Index fell to 5 on Thursday, signaling a sharp deterioration in market sentiment as digital asset prices continue to fall.
The decline reflects increasing panic among investors, with risk appetite waning in tandem with heightened global market uncertainty.
Crypto sentiment is sinking deeper into 'extreme fear'
The Crypto Fear & Greed Index measures the overall emotional state of the crypto market on a scale from 0 to 100. Values between 0 and 24 indicate Extreme Fear, 25 to 49 signal Fear, 50 represents Neutral conditions, 51 to 74 reflect Greed, and 75 to 100 denotes Extreme Greed.
At 5, the index places the market firmly in the Extreme Fear zone. The latest drop comes after a steady decline in sentiment over the past few weeks.
A month ago, the index was at 26, already within the Fear level. It fell to 12 a week earlier and recorded 11 just the day before it reached its current low point. The rapid deterioration shows how quickly confidence has fallen as prices have weakened.
The collapse in crypto sentiment coincides with a broader increase in global economic unease, as reflected in the World Uncertainty Index. This index measures how often the term 'uncertainty' appears in the Economist Intelligence Unit's country reports.
It covers more than 140 countries and provides a quarterly, country-wide indicator often used in macroeconomic research and global risk assessment.
In the third quarter of 2025, the World Uncertainty Index rose to a record level above 100,000. In the fourth quarter, it was recorded at 94,947.
These levels are roughly double the peaks seen during previous major crises, including the COVID-19 pandemic, Brexit, and the Eurozone debt crisis.
“Increasing geopolitical tensions, volatile markets, and political uncertainty are driving the increase as investors struggle to price in what happens next,” wrote Coin Bureau on X.
The elevated value signals increased unease across global markets as investors have to contend with unpredictable economic and political conditions. Against this backdrop, the crypto market's plunge into Extreme Fear reflects not only falling prices but also a broader withdrawal from risky assets worldwide.
The value of the crypto market falls 22% in 2026 as Bitcoin and Ethereum continue their decline
The weakening sentiment comes as the overall crypto market continues to move downward. In 2026, the total market value has fallen by over 22%, reversing the optimism that characterized the start of the year.
Bitcoin, which started January strong, ended the month with a decline of over 10%. It has fallen a further 14.6% so far in February.
Ethereum has also dropped by 33.8% so far this year. The decline has weighed on market activity.
Analysts are considering the next steps for the crypto market
Amid this bearish market, there is still uncertainty in the community about what happens next. Analyst Kyle Chassé pointed to historical precedents, noting that similar low levels on the Crypto Fear & Greed Index were seen in 2018, March 2020, and after the FTX collapse in 2022.
“Every time it marked a significant opportunity window. No, it doesn't guarantee a bottom. But historically, the asymmetry exists where fear is at its peak,” he said.
Other analysts believe the current decline may represent a consolidation phase before a potential breakout. However, it is unclear when, or if, a broader crypto market rally will come.
Ray Youssef, CEO of NoOnes, has predicted that Bitcoin may trade sideways until the summer of 2026. He pointed out that the exact bottom for Bitcoin remains unclear, and that the current situation increasingly suggests that the market has entered a prolonged reassessment of risk.
Youssef highlighted several structural factors, such as U.S. political and monetary cycles, persistent inflationary pressures, weaker capital flows from private investors, and cautious institutional demand following significant losses.
“As a result, it is unlikely that we will see a V-shaped turnaround before the summer of 2026. It is more likely that we will see regular upswings, triggered by short covering and short squeezes,” he stated to BeInCrypto.
Youssef believes such upswings could be strong, from 20% to 30%, and potentially last for a while. However, he warned that they could ultimately prove to be bull traps.
He stated that crypto traditionally remains in a long accumulation phase within a single trading range before a true bull market begins.
