TLDR
- Crypto traders are currently experiencing increased fear as Bitcoin prices decline and altcoins face a retrace.
- Analysts predict that the negative sentiment among crypto traders will be temporary and could soon reverse.
- Santiment’s data suggests that a recovery often follows fear in the market, as the crowd’s expectations are usually wrong.
- If Bitcoin breaks the $117,000 level, it could trigger a shift in sentiment, pushing traders back toward a bullish outlook.
- Crypto treasuries and institutional investments are seen as potential drivers for a positive shift in market sentiment.
Crypto traders have shifted to a more cautious outlook recently. As Bitcoin prices have fallen, the market sentiment has dipped into fear. Analysts, however, predict this trend is only temporary.
Crypto Traders Express Fear Amid Market Decline
On Tuesday, Santiment reported that crypto traders are increasingly expressing fear about the market. Bitcoin’s recent price drop, along with altcoins facing a retrace, has contributed to growing unease. Many traders have discussed the possibility of selling, fearing a bear market.
😱 Traders have changed their tunes, swinging more and more negative with expectations of Bitcoin falling back below $100K, Ethereum back below $3.5K, and altcoins going through a retrace period. As markets move opposite to the crowd's expectations, these couple of weeks of FUD… pic.twitter.com/Crh9sw00Bw
— Santiment (@santimentfeed) September 9, 2025
Despite this shift, Santiment added that markets often move against the crowd’s expectations. As such, the current fear could signal that a large retrace might not occur. The analytics platform noted that such periods of FUD (fear, uncertainty, doubt) tend to be short-lived, encouraging market recovery.
The Crypto Fear & Greed Index also confirmed this trend, with the index slipping into fear on Sunday. However, the market has already shown signs of recovering as investor sentiment stabilizes. Santiment’s analysis suggests that the worst of the market’s fear might already be behind us.
$117K Breakout Could Swing Sentiment Back to Bullish
Charlie Sherry, head of finance at BTC Markets, noted that crypto traders tend to react emotionally. Extreme bearish sentiment often marks the end of a price decline rather than its continuation. He pointed out that Bitcoin’s recent bounce suggests traders might be regaining confidence.
If Bitcoin breaks through the $117,000 level, Sherry expects sentiment to turn more positive. He explained that such a move would likely shift traders’ focus back to the upward potential of Bitcoin. However, the road to $200,000 could be a long one, with a high level of uncertainty in the short term.
Sherry also highlighted crypto treasuries as a potential catalyst for market positivity. Companies like Forward Industries are increasingly building large crypto treasuries, signaling long-term confidence. This development could lead to a stronger bullish trend, especially in Solana and other assets.
September Brings Caution, But Analysts See a Rebound
According to CK Zheng, co-founder of ZX Squared Capital, crypto traders tend to be more cautious during September. Zheng noted that September historically shows poor returns for equities, which affects crypto markets. However, he believes the current negative sentiment is short-term and expects a rebound.
Zheng emphasized that key economic indicators, such as the Consumer Price Index, will play a role in shaping market sentiment. He also mentioned that geopolitical factors, such as U.S. tariffs, could impact the market. Despite the current dip, Zheng believes crypto traders will regain confidence as conditions improve.
