The crypto fear greed index just hit its lowest reading ever recorded
The crypto fear greed index collapsed to a reading of 5 this week - the lowest value in the indicator’s history. Bitcoin is trading near $66,000 after four consecutive red weeks, and the sentiment data paints a picture of a market that has completely capitulated on optimism.
Key Takeaways
- The Crypto Fear and Greed Index hit a record low of 5, surpassing the previous low of 6 set during the FTX collapse in November 2022
- Bitcoin dropped to approximately $66,000 after four consecutive negative weeks, down roughly 52% from its $126,000 all-time high
- Spot Bitcoin ETFs saw approximately $5.7 billion in outflows between November 2025 and January 2026
- A total of $397 million in positions were liquidated in a single 24-hour period during the selloff
- Bitcoin's daily RSI fell to 18, placing it in extremely oversold territory historically associated with major bottoms
For context, the previous record low was 6, set during the FTX collapse in November 2022. We’re now below that. Whether this turns out to be a generational buying opportunity or a warning sign of deeper trouble ahead depends entirely on which camp you listen to.
What happened to Bitcoin this week
Bitcoin briefly punched through $71,000 early in the week, triggering a wave of short liquidations. The bounce didn’t hold. By Tuesday, BTC had fallen back below $67,000, and the market resumed its grind lower.
The numbers tell the story:
- Bitcoin is down roughly 52% from its $126,000 all-time high
- $397 million in positions were liquidated in a single 24-hour period
- $5.7 billion has flowed out of spot Bitcoin ETFs since November 2025
- This marks the fourth consecutive negative week for BTC
CNBC reported that bitcoin’s daily RSI fell to 18, putting it in extremely oversold territory. That’s the kind of reading you typically see at major bottoms - or during extended bear markets where oversold conditions persist longer than anyone expects.
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The ETF exodus keeps accelerating
Spot Bitcoin ETFs, which were supposed to bring stable institutional demand, have become net sellers. The Washington Times reported that investors pulled approximately $5.7 billion from these products between November 2025 and January 2026. November alone set a record for monthly outflows.
The timing is painful. These ETFs launched to massive fanfare in early 2024 and attracted billions in their first year. Now the same vehicles are amplifying sell pressure instead of absorbing it. When ETF holders panic, they sell units on the open market, which forces authorized participants to redeem shares and dump the underlying bitcoin.
UBS went as far as declaring that “crypto is not an asset” in a research note published this week. Galaxy Digital CEO Mike Novogratz offered a more measured but still sobering take, suggesting that crypto’s “age of speculation” may be over.
Why the crypto fear greed index matters right now
The fear greed index aggregates several data points: volatility, market momentum, social media sentiment, bitcoin dominance, and Google Trends data. A reading of 5 means every single one of those inputs is flashing red.
Here’s where it gets interesting. Historically, extreme fear readings have been better entry points than exit points. The index hit 6 during the FTX crash, and bitcoin went on to rally over 300% in the following 18 months. Anyone who understood how dollar-cost averaging works during that period did very well. It hit 10 during the COVID crash in March 2020, and that turned out to be one of the best buying opportunities of the decade.
But history doesn’t always repeat. The current drawdown is different in a few ways:
- It’s happening after bitcoin already hit $126,000, a level many thought was the cycle top
- Institutional players (ETFs, funds) are actively selling, not buying the dip
- Macro conditions remain uncertain with inflation data still coming in hot
Seeking Alpha published an analysis arguing that this selloff looks like “orderly deleveraging rather than capitulation.” That distinction matters. Capitulation tends to mark bottoms. Orderly deleveraging can grind on for months.
What the analysts are actually saying
The market is split into two camps right now, and both have reasonable arguments.
The bulls point to the RSI at 18 (historically oversold), the record-low fear index (historically a buy signal), and the fact that bitcoin’s four-year halving cycle remains intact. They argue that the selling is exhaustion-driven and that a relief rally above $75,000 could come quickly once selling pressure fades.
The bears counter that bitcoin dropping 52% from its high is exactly what you’d expect at the start of a bear market, not the end of one. They point to persistent ETF outflows, weakening on-chain metrics, and the fact that altcoins like Ethereum and Solana are down even harder (24% and 26% respectively for the first week of February alone).
One data point worth watching: Bitget reported that BTC briefly surged to $71,000 before quickly dropping back to $68,000, wiping out traders on both sides. If you’re not sure how liquidation cascades work, our full guide breaks down the mechanics. That kind of two-way liquidation cascade usually happens when the market hasn’t found its equilibrium yet.
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What to watch next week
Three things will determine whether bitcoin stabilizes or breaks lower:
US inflation data. The latest CPI report drops today (February 13). If inflation comes in hotter than expected, risk assets including crypto will likely take another leg down. A cooler print could provide short-term relief.
ETF flow direction. If outflows slow or reverse, it would signal that institutional panic is easing. Bitget Wallet analyst Lacie Zhang noted that “with easing ETF outflows and steadier institutional behavior, selling pressure may be fading.” That’s a hopeful read, but one week of data won’t confirm a trend change.
The $60,000 level. Bitcoin bounced hard off the low-$60,000 range last week. If that level gets retested and holds, the technical case for a bottom strengthens. If it breaks, the next major support sits around $52,000 - a level that would represent a 60% decline from the all-time high.
The bottom line
The crypto fear greed index at 5 is telling you something, but it’s not telling you what to do about it. Record fear has preceded massive rallies before. It’s also preceded further declines when the underlying conditions justified continued selling.
What we know: bitcoin is deeply oversold by most technical measures, institutional money is flowing out rather than in, and the market hasn’t found a level where buyers consistently step in. The relief rally to $71,000 failed. The bounce from $60,000 is being sold into.
If you’re a long-term holder, extreme fear readings have historically rewarded patience. If you’re trading with leverage, this is the kind of environment that liquidates both sides without warning. Size positions accordingly and keep your risk management tight. The market will tell us which camp was right - it always does.
Related reading
- Bitcoin reclaims $70,000 after brutal selloff as fear index hits historic lows
- Bitcoin crashes to $74,674 in ‘Black Sunday II’ as $2.5B in positions liquidated
- How to trade crypto futures during high volatility
Frequently Asked Questions
What does a Crypto Fear and Greed Index reading of 5 mean?
A reading of 5 on the Crypto Fear and Greed Index indicates extreme fear in the market. The index ranges from 0 (maximum fear) to 100 (maximum greed). A reading this low suggests that most market participants are highly pessimistic, which historically has sometimes coincided with market bottoms.
How is the Crypto Fear and Greed Index calculated?
The index uses multiple data sources including market volatility, trading volume, social media sentiment, Bitcoin dominance, and Google Trends data. Each factor is weighted to produce a single score between 0 and 100.
Should you buy Bitcoin when the Fear and Greed Index is at extreme fear?
Historically, periods of extreme fear have sometimes presented buying opportunities, but they have also preceded further declines. The index alone is not a reliable buy signal. It should be combined with other analysis tools and your personal risk tolerance before making trading decisions.