Investor confidence in the cryptocurrency market deteriorated sharply this week as over $230 billion in value vanished within 24 hours. A sudden downturn sent the Crypto Fear & Greed Index tumbling into “fear”, signalling heightened anxiety across digital asset markets and triggering widespread sell-offs.

Market Sentiment Turns Bearish

The Crypto Fear & Greed Index, which evaluates market sentiment based on volatility, momentum, social trends and dominance metrics, fell to 28 — its lowest point since April. This drop indicates a clear shift from neutral sentiment to fear, inching close to “extreme fear”.
Traditional markets echoed a similar trend, with the Fear & Greed Index for equities falling to 22 after US stock indices closed lower. Ongoing concerns over credit market stress, regional bank exposure to bad loans and escalating US–China trade tensions added to investor unease.

Massive Sell-Off Hits Major Cryptocurrencies

According to CoinMarketCap, total cryptocurrency market capitalisation dropped to around $3.54 trillion from $3.78 trillion, marking a six per cent daily decline. Leading cryptocurrencies sustained heavy losses as the correction deepened.
Bitcoin (BTC) fell nearly six per cent to approximately $105,000, while Ether (ETH) dropped around eight per cent to $3,700. Among major altcoins, BNB led declines with a fall of almost 12 per cent. Chainlink (LINK) dropped 11 per cent and Cardano (ADA) slid nine per cent.

Solana (SOL) and XRP also lost over seven per cent, erasing double-digit gains accumulated earlier in the month. On average, leading non-stablecoin assets fell between eight and nine per cent in the past 24 hours.

Liquidations Remain Lower Despite Heavy Losses

Unlike last week’s crash, which triggered nearly $20 billion in liquidations, the latest downturn saw more limited forced selling. Data from CoinGlass revealed that approximately $556 million in leveraged positions were liquidated on Friday.
Of this total, around $451 million came from long positions, while $105 million originated from short liquidations. This suggests that although prices fell sharply, market participants may have reduced high-risk exposure ahead of the drop.

Memecoins and NFTs Suffer Double-Digit Losses

The sell-off extended beyond blue-chip cryptocurrencies. Memecoins, which had shown minor signs of recovery earlier in the week, plunged 33 per cent within 24 hours. Leading memecoin assets saw declines of nine to 11 per cent, though trading volumes remained high at nearly $10 billion.
The non-fungible token (NFT) sector also struggled. After recovering from a $1.2 billion decline last week, the NFT market value slipped below $5 billion — a level last seen in July. CoinGecko reported double-digit losses across most top-tier collections.

ETF Outflows Reflect Institutional Retreat

Institutional sentiment weakened as spot cryptocurrency exchange-traded funds (ETFs) registered significant outflows. Spot Bitcoin ETFs recorded more than $536 million in withdrawals on Thursday. Spot Ether ETFs saw net outflows exceeding $56 million during the same period.
These institutional exits highlight growing caution among professional investors, who appear to be scaling back exposure amid heightened market volatility and macroeconomic uncertainty.

Outlook: Rising Uncertainty Ahead

The rapid shift in sentiment and steep capital outflows underscore the fragility of current market conditions. With global financial concerns intensifying and cryptocurrencies facing increased pressure, analysts warn that further declines are possible if investor confidence fails to stabilise.
For now, the market remains on edge, closely watching macroeconomic developments and institutional movement to determine whether this downturn marks a temporary setback or the start of a deeper correction.