The crypto market experienced a severe downturn on Tuesday, and according to many on-chain metrics marked a bottom in bitcoin’s (BTC) price.
The total crypto market capitalization hovered just above $2.7 trillion—marking a nearly $1 trillion wipeout since its peak in December 2024, according to TradingView data. Several indicators suggest that Tuesday’s sell-off may have marked a local bottom.
Andre Dragosch, Head of Research at Bitwise Europe, highlighted that the Crypto Asset Sentiment Index hit its lowest level since August, coinciding with the unwinding of the yen carry trade, which saw bitcoin make a bottom at around $49,000.
“The Crypto Asset Sentiment Index just flashed a massive contrarian buy signal for Bitcoin. Widespread bearishness across flows, on-chain data, and derivatives suggests that downside risks are fairly limited. At these prices, the risk-reward outlook appears quite favorable,” Dragosch noted.
On Tuesday,…
