Key Takeaways
- Retail crypto sentiment is at its lowest in years.
- Bitcoin trades below $100,000 after Trump's tariff policies.
- Memecoins like PEPE and DOGE have dropped over 20% in a week.
A growing divide has emerged between retail and professional investors in the Bitcoin market, according to Bitwise Chief Investment Officer Matt Hougan.
While experienced investors remain optimistic, retail sentiment has plummeted to its lowest levels in years.
Retail fear takes hold
Hougan stated in a Feb. 7 post on X:
There is an absolutely massive disconnect between retail and professional sentiment in crypto right now.
The Crypto Fear & Greed Index currently shows a “Fear” score of 44, dropping 25 points from last month’s “Greed” score of 69.
Bloomberg ETF analyst James Seyffart attributed this decline to retail investors holding underperforming altcoins and memecoins, which have suffered significant losses.
Memecoin market crash
According to CoinMarketCap, the top three memecoins have dropped sharply over the past week:
- Pepe (PEPE): -35.31%
- Shiba Inu (SHIB): -20.82%
- Dogecoin (DOGE): -24.69%
Asset preferences split
While the retail market is struggling, some areas remain active.
Pseudonymous trader DFarmer noted that the altcoin market has faced an unprecedented “bloodbath.”
However, DeFi Dad pointed out that sentiment varies by asset: retail investors are more bullish on Solana (SOL), while Ethereum (ETH) remains favored by professionals.
Bitcoin price action
Despite hitting $100,000 in December 2024, Bitcoin has struggled to maintain that level.
It currently trades at $96,609, affected by recent macroeconomic events such as Trump’s tariffs on Canada, Mexico, and China, which led to the largest crypto liquidation event in history.
Although Trump later paused tariffs on Canada and Mexico, Bitcoin has yet to reclaim its psychological milestone.
