Bitcoin Loses All Profits, Market Sentiment Plummets to Unprecedented Fear

Recent Bitcoin volatility has caused concern among traders, but the picture is not entirely one-sided. Reports have documented significant losses for late buyers, and on-chain data shows real money being traded as positions are forced to close. The market is moving quickly; market sentiment is also shifting. Fear and Greed Index Drops to Single Digits According to CoinGlass, over 144,839 traders were liquidated in the past 24 hours, with total liquidation exceeding $508 million, and about 92% related to long buy positions. According to a report from Alternative.me, the Cryptocurrency Fear and Greed Index has dropped to 5 out of 100 — a figure that has only appeared three times since 2018. This level indicates panic. However, panic often clears out the most vulnerable holders and creates opportunities for more experienced traders to step in.

Realized Losses and Capitulation Signals According to Glassnode, recent investors are still experiencing high losses — the seven-day moving average of realized losses has reached nearly $500 million per day. Such intense selling pressure looks very severe on the chart. At the same time, large-scale sell-offs could mark the end of a sharp decline, as they reduce the remaining number of sellers when prices continue to fall.

Bitcoin Price Development In this context, price volatility plays a crucial role. Bitcoin rose to around $68,600 on Saturday but then retreated and touched the mid-$64,000 range after a wave of selling. Traders are watching the price range formed after the dip to around $60,000 in early February. The asset is still about 48% below the October peak of $126,000 and roughly 5.5% below the 2021 high of nearly $69,000. News related to US-Iran tensions and overall risk-avoidance sentiment have prompted some investors to shift to safer assets, further exacerbating the decline.

Sharpe Ratio Reaches Unusually Low Levels Analyst Michaël van de Poppe shared a chart showing Bitcoin’s Sharpe Ratio at -38.4. This index measures returns relative to risk; such a low figure is very rare.

Historically, extreme negative ratios sometimes coincide with periods of lower buying risk, as potential downside has been eliminated by large sell-offs. This does not guarantee a recovery, but it changes how investors perceive the trade-off between profit and risk. What Could This Lead To? Some technical analysts warn that there could be further tests of support levels if volatility persists. Others point to the combination of mass liquidations, deep fear index readings, and large realized losses as signals that a bottom may be forming. On-chain trading data from the past shows that panic and heavy losses often occur before calmer periods, when buyers gradually return.