Bitcoin News Today: Crypto's Extreme Fear: A Buying Signal or Omen of Collapse?

The cryptocurrency market has plunged into "Extreme Fear" territory, as the widely tracked Fear and Greed Index plummeted to 21 on November 4, down from 42 the previous day, according to Coinotag. This level, the lowest since hitting 18 during the October 11 liquidation crisis, signals heightened capitulation risk and a shift toward risk-off behavior among traders and investors, Coinotag reported. The index, which aggregates volatility, trading volume, social media sentiment, and Bitcoin dominance, now reflects a market bracing for further turbulence, according to Lookonchain.

Bitcoin (BTC) fell 3% to $104,500, while Ethereum (ETH) and Solana (SOL) dropped 5% and 8%, respectively, Coinotag noted. The selloff accelerated as long-term Bitcoin holders offloaded $40 billion in October, exacerbating downward pressure. Derivatives markets saw $1.33 billion in liquidations in the past 24 hours, with 90% impacting long positions, according to Yahoo Finance. Gabriel Selby of CF Benchmarks added that "the liquidation on October 10 left price inefficiencies that made a near-term correction inevitable."

The downturn coincided with broader macroeconomic anxieties. Federal Reserve Chair Jerome Powell hinted at a potential pause in rate cuts, dampening hopes for relief in risk assets, and executives at Goldman Sachs and Morgan Stanley warned of equity market corrections, further spooking crypto investors. Meanwhile, the U.S.-China trade deal—announced October 30—failed to spark a sustained rally, with Bitcoin rising just 0.26% post-announcement, a Brave New Coin analysis found. Analysts attributed the muted response to lingering geopolitical uncertainties and unclear enforcement mechanisms in the agreement.

Institutional dynamics added complexity. Ether ETFs outperformed Bitcoin ETFs in Q3 2025, attracting $9.6 billion in inflows versus Bitcoin's $8.7 billion, according to Benzinga. However, BlackRock's absence from altcoin ETF proposals raised concerns about limited inflows for non-Bitcoin assets. Bitget's $2 million interest-free loan program for altcoin liquidity providers aimed to counter fragmented market depth, though the Altcoin Season Index remains at 27 out of 100.

Market participants remain divided on the outlook. Some view the 21 fear level as a potential buying opportunity; "Everything beneath $112,000 is a great entry point," argued Michaël van de Poppe in the Yahoo piece. Others, like economist Peter Schiff, dismissed crypto as a "decentralized Ponzi scheme," mocking President Trump's push for U.S. crypto leadership. Trump, meanwhile, framed the industry as a national security issue, claiming China seeks to dominate a sector he called "essential for jobs and innovation," Benzinga reported.

The path forward hinges on several catalysts. The December Fed meeting could dictate risk appetite, while implementation of the U.S.-China trade deal may reduce geopolitical headwinds. On-chain metrics suggest stabilization if Bitcoin holds above $100,000, but major holders' selling pressure remains a wild card, Sherwood News reported. For now, the market's "extreme fear" underscores a fragile equilibrium—one where sentiment shifts could reignite volatility or spark a sustained recovery.