Emotional flood in the crypto market

The turmoil in the global economy has dampened the mood in the cryptocurrency market, which has yet to reach the desired level. The tension in global trade ignited by US President Donald Trump has led to uncertainty in both the stock and cryptocurrency markets. Moreover, despite the current conjuncture appearing quite favorable for cryptocurrency investors from an external perspective, in practice, things have evolved quite differently.

Bitcoin's (BTC) value fell to as low as 93,000 dollars at the beginning of last week due to concerns about trade wars, causing altcoins to bleed. BTC's market dominance has risen back to 60%, with some major altcoins experiencing double-digit losses. However, there were expectations that Trump's crypto-friendly administration would bring about an altcoin season in the market.

"The market has gone crazy"

Crypto analyst Sykodelic, who advocates the view that 'the market is completely out of control. It has lost all logic and rationality,' stated, 'The world's largest government trying to centralize crypto and a US president holding 400 million dollars worth of ETH. Meanwhile, the market continues to regress.' According to the analyst, this situation is causing confusion for investors and leading some to exhaustion.

"HODLing has never been more meaningful"

"Analyst Skyodelic, who claims the future of 'a massive rise', said, 'They know that the majority is in altcoins. The system is designed for us to lose, but this time the situation is different: HODLing has never been more meaningful."

“We are just getting started”

Another crypto analyst who expects a significant rise despite the uncertainty in the market is Michaël van de Poppe. The founder of MN Consultancy, a well-known figure in the industry, referred to David Sacks, who currently serves as the 'Crypto Czar' under the new administration in the US, in his recent statement: 'The US government is aiming for a golden age in crypto. It will be the government that brings the most growth in crypto. Everyone thinks that we have reached the peak of the market, but we are just getting started.'

"No one should expect the Trump effect without seeing proper data"

Crypto analyst Emre İşlek, speaking exclusively to Coinkolik, claimed that the crypto market felt the aftershocks of the statements made by the Federal Reserve on December 18, 2024: “Jerome Powell had stated that they were having trouble fighting inflation. That's why we are still feeling the effects of the signals that the interest rate cut process will be paused.” İşlek used the expressions, “This is why all projections have changed or been postponed. No one should expect a positive Trump effect on cryptos without seeing proper inflation and employment figures.”

The situation is not at all comforting in the Fear and Greed Index, one of the important metrics of the market. The index, which rose to 81 points in December 2024, displaying a "greedy" outlook, has fallen to 38 points as of February 5th.

Activity in Ether ETFs

On the other hand, there is significant activity in spot exchange-traded funds (ETFs) traded in the US. On Tuesday, February 4, there was an inflow of $340 million into spot Bitcoin ETFs and $307 million into spot Ethereum ETFs. Bitcoin has maintained a sideways trend at $98,000 in the last 24 hours, while Ether is changing hands at $2,780 with a 2% increase.

This article does not contain investment advice or recommendations. Every investment and trading activity involves risks, and readers should conduct their own research when making decisions.