The Crypto Fear and Greed Index surged 17 points in a single day, reaching 49 on March 20 and shifting from “Fear” to “Neutral” territory.
According to Alternative.me, the index gauges investor sentiment by analyzing market momentum, volatility, Bitcoin dominance, and social media trends. The shift to neutral suggests that investors are adopting a more balanced market outlook, moving away from extreme caution or speculative enthusiasm.
Fed’s Interest Rate Decision Fuels Market Optimism
The improving sentiment follows the Federal Reserve’s decision on March 19 to maintain interest rates at 4.25%–4.50%, extending its pause on rate cuts amid economic uncertainty.
Fed Chair Jerome Powell noted that inflation remains high and cautioned that Trump’s tariffs could prolong the fight against rising prices. While the Fed’s dot plot still projects two rate cuts in 2025, Powell admitted that assessing the full impact of tariffs on inflation remains challenging.
Following the Fed’s announcement, U.S. stock markets rallied:
- S&P 500, Nasdaq, and Dow Jones all closed over 1% higher.
- Bitcoin surged 3% to $85,786, briefly hitting $87,431, its highest level since March 9.
- Ethereum climbed 4% to $2,022, while Solana jumped 6% to $133.
The total crypto market cap now stands at $2.91 trillion, up 2% in 24 hours. Futures markets saw $355 million in liquidations over the past 24 hours, with $258 million coming from short positions, per Coinglass data.
Institutional Interest in Crypto Rises
Investor confidence is also being driven by:
- The upcoming launch of Solana exchange-traded funds (ETFs) on March 20.
- The return of Bitcoin ETF inflows, with $483 million added over the past week, reversing a five-week outflow trend, according to SoSoValue data.
These factors indicate growing institutional demand for digital assets and suggest that sentiment is shifting in favor of long-term crypto adoption.
Despite the Fed’s steady rate stance, Powell warned that consumer spending—a key driver of economic growth—is beginning to slow down. As a result, investors remain cautious about inflation trends, potential tariff impacts, and ongoing monetary policy uncertainty.
For more crypto market updates, visit Crypto News and The Coin Info.
