The Crypto Fear and Greed Index, a gauge of market sentiment in Bitcoin and the broader cryptocurrency sector, has sharply declined to its lowest level in about a year and a half. On June 24, the index dropped by 21 points, entering the "Fear" zone, marking one of the most significant day-to-day decreases recently.

Just seven weeks ago, the index was within the "Fear" range (score between 24 and 50), but it hasn't been below 30 since January 11, 2023, when Bitcoin was trading around $17,200 shortly after the FTX crypto exchange incident.

Several factors contributed to this negative sentiment around Bitcoin, including a potential $8.5 billion market sell-off by Mt. Gox, significant outflows from U.S. spot Bitcoin ETFs, and Germany's decision to sell part of its Bitcoin reserves. Additionally, increased selling by Bitcoin miners amid a declining network hashrate likely exacerbated the pessimism.

In contrast, a senior executive at Galaxy Digital, a cryptocurrency investment firm, suggested that the market might be overreacting to the Mt. Gox sell-off news. Despite this sentiment shift, Bitcoin currently trades at $60,300, rebounding from a seven-week low reached on June 24.