Risk Appetite In The Crypto Market At The Highest Of The Last 16 Months

The crypto fear and risk appetite index, which measures the perception of crypto investors towards the market, reached a new high in the first quarter of the year.

The positive emotion that rose rapidly after the comeback in March was shown with a value of 68 on the index. This level, which shows that the risk appetite has increased, was last seen in November 2021, when Bitcoin reached its all-time high. During this time, Bitcoin gained a rapid upward momentum following the emergence of the banking crisis after testing below $20,000 from the first days of the month, and returned to the June 2022 level, rising as high as $28,470 yesterday. This move caused the positive perception of investors on cryptocurrencies to rise rapidly.

According to the latest situation, the cryptocurrency fear and risk appetite index rose to 68 and returned to its value in November 2021. While the risk appetite decreased rapidly at that time, it saw a historical bottom by falling as low as 6 in June last year. The cryptocurrency fear and risk appetite index, which has been fluctuating since then, continues to reflect the return of the positive sentiment towards cryptocurrencies with the increase in demand in 2023.

On the other hand, in the comments made for the Bitcoin fear and risk appetite index, there are warnings that when the index enters the risk appetite region, the current levels reflect the overbought region. In the opposite case, it is interpreted that the extreme fear levels indicate the oversold region, and an increase is expected from these regions. However, this interpretation is not always accepted as valid according to the current period and developing events. Still, experts warn investors not to get excited about the market rise in periods when volatility will increase.