Bitcoin is under pressure again, and investors are feeling nervous.

The Bitcoin Fear and Greed Index, which measures overall market sentiment, has dropped to 5 out of 100. This level is called “extreme fear.” It is one of the lowest readings ever recorded since the index was created in 2018.

The decline happened as bitcoin fell more than 4%, dropping to around $64,000. This erased the gains it made over the weekend, when it briefly climbed to about $68,600 before turning lower again.

In just 24 hours, more than 136,000 traders were liquidated. Total losses from liquidations on February 22 and 23 reached about $875 million. Most of these were traders who had bet that the market would continue rising. When it turned instead, their positions were automatically closed, adding more selling pressure.

A reading of 5 on the Fear and Greed Index is very rare. It has only reached this level a few times in the past, including during major market downturns in 2019 and 2022.

The index looks at things like price volatility, trading momentum, social media activity, and market trends. The current reading indicates a state of “extreme fear,” showing that many investors are gripped by panic and are selling off their positions in response to market pressure.

The index has been falling steadily in recent weeks, showing that confidence has been weakening for some time.

Bitcoin is now trading about 50% below its all-time high of $126,000, which it reached in October 2025. It is also around 5.5% below its 2021 peak of $69,000.

Earlier this month, bitcoin briefly dropped to around $60,000 in a flash crash. That marked a total decline of about 52% from its highest price. While it has recovered slightly since then, it remains far below its previous highs.

Blockchain data shows that many recent investors are still selling at a loss. According to analytics firm Glassnode, the seven-day average of realized losses is close to $500 million per day. This suggests ongoing capitulation, meaning investors are giving up and exiting their positions.

“While the intensity has cooled, the broader regime still signals a market under pressure,” Glassnode noted, adding that investors in this phase are “continuing to capitulate.”

Another important measure, called the Sharpe Ratio, has dropped to around -38.4. This ratio measures returns compared to risk. A deeply negative reading means recent performance has been very poor relative to volatility.

Interestingly, some analysts say such extreme readings have historically appeared during strong buying opportunities. Michaël van de Poppe called the chart “phenomenal,” noting that similar levels have marked “low risk” accumulation zones in the past.

Extreme fear levels sometimes happen near market bottoms. However, they can also appear during long bear markets.