A CoinGecko survey found mixed investor and trader sentiment about the current state of the crypto market. Among investors, 54.1% are bullish, 25.2% are neutral, and 20.8% are bearish. Traders expressed similar opinions, with 39.1% bullish, 27.5% neutral, and 33.5% bearish.
While the sentiment leans towards bullish among those actively engaged in the crypto industry, most spectators (42.5%) have a negative outlook on crypto’s future, and only 28.5% are hopeful.
Let’s unpack the key reasons behind this divide.
$BTC Sell-Offs, Scams, and Tightening Regulations Trigger FUD
In mid-June, the German government started selling off its $BTC holdings seized from a movie piracy website (Movie2k.to) worth approximately $3B.
Although German authorities reclaimed $200M of $BTC from major exchanges, it triggered fear, doubt, and uncertainty among traders. Further fueled by the Mt. Gox repayments, many began to panic-sell to offset potential losses.
The hardest hit were high-frequency traders who profit from short-term price movements. Many also use leverage, which further amplifies their gains and losses.
Stance on digital assets has become one of the key issues in the ongoing US presidential election campaign, with Donald Trump promising to become the ‘crypto president’ and Joe Biden taking a cautious approach.
Lastly, scams plaguing the crypto market, particularly in presales due to social media hype and lack of reliable information, have made investors aware. Hacks have also become prevalent, with nearly $1.5B stolen in the first half of 2024.
$BTC’s dip caused a broader market decline in the last month:
Meme tokens have also dipped monthly, as many investors have become risk-averse and fled volatile assets:
However, there’s some hope on the horizon, with top tokens rebounding in the last week following the end of $BTC’s sell-off.
Crypto Winter or Buying Opportunity?
Meanwhile, whales see the current $BTC slump as a buying opportunity. According to CryptoQuant, whales have been accumulating their holdings at 6.3% per month, the fastest since April 2023.
Moreover, the Commodity Futures Trading Commission (CFTC) chief noted yesterday that $BTC and $ETH ETFs are commodities. Clear regulatory oversight legitimizes crypto in the eyes of traditional investors and financial institutions, giving hope for its growing adoption.
Today, I testified on digital commodity assets in front of the Senate Agriculture Committee. Read my remarks at https://t.co/JojHNdQoVh
— Rostin Behnam (@CFTCbehnam) July 10, 2024
Final Thoughts
Currently, community sentiment is a mixed bag, with traders, investors, and spectators expressing opposite opinions.
A fifty-day moving average analysis suggests a weak trend for the top three crypto tokens. However, a neutral relative strength index indicates that the price could move in either direction. The question is: What will be the next catalyst event?
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Lora Pance Crypto & Tech Content Writer 
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