The Crypto Fear and Greed Index has settled into neutral territory following its recent spike

As per the data from Alternative.me, the index dropped to levels last seen in October 2023 on January 15. This shift occurred in the wake of the U.S. approval of the first spot Bitcoin (BTC) ETFs.

The index now stands at 52 out of 100, reflecting a cautious market mood. This is the lowest score recorded since October 19 of the previous year, when Bitcoin’s average daily trading price was around $31,000.

Interestingly, just days prior, the index had reached an “extreme greed” level of 76, driven by market anticipation of the spot Bitcoin ETFs’ approval.

The Fear and Greed Index quantifies the collective emotions of cryptocurrency investors. It aggregates data from six primary market indicators: volatility (25%), market momentum/volume (25%), social media activity (15%), surveys (15%), Bitcoin dominance (10%), and Google trends (10%).

On the evening of January 10, the U.S. Securities and Exchange Commission (SEC) approved 11 spot Bitcoin ETF applications. The successful applicants included prominent names like Bitwise, Grayscale, Hashdex, BlackRock, Valkyrie, BZX, Invesco, VanEck, WisdomTree, Fidelity, and Franklin Templeton.

Leading up to the announcement, misinformation circulated on X, with a counterfeit SEC post claiming the ETFs had already been approved. The SEC later clarified that its account had been compromised, which led to significant price fluctuations in Bitcoin.