Here’s Why Bitcoin’s (BTC) Crash Is a Sentiment Flush, Not a Structural Breakdown

Fear & Greed crashed to 21, social media abandoned lofty targets, and the crowd snapped into pure survival mode.

After plunging below $100,000 this week, Bitcoin (BTC) appears to be losing upside traction, raising the risk that the more ambitious 2025-end targets may not be reached this year.

Despite intense short-term volatility, fresh data suggests that the latest price action is not a structural reversal, but “a sentiment-led pullback within an otherwise intact market trend.”

A Sentiment Crash, Not A Network Crash

A sudden collapse in confidence was first flagged when Bitcoin fell below a crucial support level of $107,000. CryptoQuant explained that the Fear & Greed Index fell to 21, and bullish price targets in the $150,000-$200,000 zone disappeared from social feeds.

Google search interest for Bitcoin also cooled significantly after October, and altcoin sentiment reached -81. The analytics platform stated that in crypto, because the market structure is still immature and liquidity is uneven, sentiment always carries outsized price impact.

However, despite Bitcoin’s brief decline below $100,000 on Tuesday for the first time since June, on-chain data shows no major breakdown.

For instance, exchange withdrawals have actually increased, which can reflect more coins moving toward self-custody rather than distressed exits. UTXOs in loss sit around 12%, which is considered high, but still far from historical capitulation levels.

Meanwhile, the network hash rate remains close to 1.1 ZH/s, pointing to strong mining participation. Whale ratio has declined, which helps reduce heavy sell pressure. And $10.7 billion in stablecoins flowed into Binance, which strengthens potential buy-side firepower.

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Additionally, CryptoQuant said that while realized cap trends show long-term holders taking some profit, fresh demand is absorbing it.

Santiment also found that the reaction across social channels has now flipped into outright fear. The Trending Words Dashboard shows that the top rising phrases are overwhelmingly about Bitcoin price levels, with “100K” and “BTC” leading the surge, which proves that the entire retail conversation has shifted from speculative altcoins back to Bitcoin and Ethereum.

Meanwhile, the Trending Stories Dashboard is heavily focused on the Bitcoin break below $100,000 and renewed debates about whether this confirms the beginning of a proper bear market.

Zooming Out

According to Santiment, this is exactly what happens when the crowd starts capitulating – attention pivots to BTC’s survival, not altcoin narratives. Their sentiment-based price range indicator also shows the shift as the $50K-$100K band suddenly spiked with the dip, while Ethereum is seeing fresh calls for sub-$3,000 levels after ETH briefly dropped toward ~$3,090.

The analytics platform observed that this move into extreme negative chatter is important as Tuesday was the third most bearish day for crypto in six months, and historically, the only two more bearish days than this one were both cycle bottoms. Ethereum’s bearish sentiment spike is even worse, second only to the October 10 flash crash.

Most of the altcoins, however, are not even being discussed as retail remained fixated on BTC and ETH. This is a clear fear signal, and this level of FUD has historically proven to be a favorable sign of some upcoming relief.