Crypto sentiment has shifted dramatically in less than two weeks, with traders moving from caution to aggressive risk-taking as the Fear & Greed Index reaches levels last seen shortly before October’s record $19 billion liquidation event.

The widely followed Crypto Fear & Greed Index from Alternative.me climbed to 74 on Tuesday, compared with just 27 on Aug. 12. The reading then eased to 65 on Wednesday. The gauge remained in fear territory from late July through Aug. 19 and hit 25 on Aug. 6, marking “extreme fear.”

The index runs from zero to 100 and measures market mood using Bitcoin’s volatility and momentum as its largest components. It also incorporates social media activity, Bitcoin’s percentage of total crypto market value and Google search trends. Scores above 50 are classified as greed.

The indicator reflects current investor behavior rather than serving as a direct forecast for future prices.

A comparable reading was last recorded on Oct. 5, 2025, just days before a sharp market collapse forced roughly $19 billion in leveraged positions to be liquidated during one trading session. That remains the biggest such liquidation event on record.

Risk-Taking Spreads Across Crypto

The rapid change in sentiment has accompanied a powerful rebound in digital assets. Bitcoin climbed from below $68,000 last week to almost $80,000, while some major tokens gained as much as 70%.

Investors have also rotated toward the so-called debasement trade after speculative interest had been focused heavily on artificial intelligence, memory-chip and semiconductor stocks.

Speculation has been particularly intense in smaller cryptocurrencies. Dogecoin has risen approximately 24% over seven days, while several low-cap memecoins have delivered much larger returns.

Thinking Cat jumped 131%, Cash Cat gained 113%, and Dog (Bitcoin) came close to doubling over the same period.

Heavy buying in thinly traded tokens is often viewed as a sign that investors are embracing greater risk. However, elevated greed readings can also indicate excessive optimism and increase the risk of a market pullback.

Jackson Hole Speech in Focus

The next major test for crypto markets arrives Friday, when Federal Reserve Chair Kevin Warsh delivers his first keynote speech at Jackson Hole as chair.

Investors will be watching for indications about interest rates and inflation after recent volatility in long-term U.S. Treasury yields. The latest decline in those yields helped support Bitcoin’s advance from below $68,000.

As market sentiment swings firmly back toward greed, traders will be assessing whether the rally has enough momentum to continue or whether risk appetite has become too stretched.