Virtual asset Fear and Greed Index falls to 16… Bitcoin and XRP under bearish pressure

The Fear and Greed Index, which shows investor sentiment in the virtual asset (cryptocurrency) market, has fallen back into the 'extreme fear' zone, and a weak trend continues for major assets such as Bitcoin (BTC) and XRP.

According to crypto-specialized media Cryptopolitan on the 15th, the Fear and Greed Index stood at 16 that day. This is close to this year's low of 10 recorded last November, suggesting that investor sentiment has generally remained in a fearful phase over the past two months. Over the past year, the proportion of index readings falling into the 'fear' or 'extreme fear' categories exceeded 30%.

Bitcoin traded around $88,900 that day, about 30% lower than its all-time high of $126,000. Since the volatility expansion last autumn, it has failed to mount a clear rebound and has continued a weak trend below $90,000.

Ethereum (ETH) has also fallen about 36% from its August peak of $4,946, and XRP has lost more than 40% of its value from its peak amid a corrective phase over the past few months. The market is assessed as not having entered a meaningful recovery phase even after the large-scale liquidations in October.

Market analysis points to the possibility of a rate hike by the Bank of Japan (BOJ) and a global liquidity environment weighing on risky assets overall. If the BOJ raises its policy rate to 0.75% this month, it would be the highest level in about 30 years. Reference is also made to the precedent when, following the BOJ's rate hike in July 2024, Bitcoin fell briefly from $65,000 to around $50,000.

However, some positive factors were also mentioned. The Federal Reserve (Fed) ended quantitative tightening (QT) earlier this month and began supplying liquidity to the market, and institutional investors' access to virtual assets is gradually resuming, according to analysis.

Meanwhile, XRP has continued to see inflows into spot ETFs despite the volatile market. According to SoSoValue data, the XRP spot ETF recorded net inflows for 19 consecutive trading days, with $20,100,000 flowing in on Friday alone. Cumulative net inflows approached $990,910,000.