The crypto fear and greed index reached 81, hitting “extreme greed” for the first time since December 17, 2024. The milestone follows a more than 22% jump in Bitcoin's price over a seven-day period.
According to market trackers, the sentiment shift was among the fastest of the year. The gauge previously read 36 a month ago and 41 a week prior, representing a sharp recovery from a low of 5 recorded on February 5. While alternative trackers place the current reading slightly lower in the standard “greed” category, all major metrics point in the same upward direction.
The sudden change in market mood was sparked by a Treasury policy decision rather than an exchange-traded fund headline. On Wednesday, Treasury Secretary Scott Bessent announced an increase in the department's long-duration bond buybacks, raising operations from $2 billion to at least $4 billion, with potential for further increases. Although the program is scheduled to run from September 9 through November 4 and funds have not yet moved, the announcement caused long-bond yields to fall sharply.
Traders who had shorted Bitcoin were caught off guard by the shift, resulting in approximately $3 billion in short positions being liquidated over the following day and driving prices higher.
Bitcoin's weekly gains outpaced the rest of the broader crypto market. CryptoQuant reported that its Bull Score jumped from 30 to 80 within a week, with eight of ten underlying signals turning bullish. LMAX Group strategist Joel Kruger noted that the May 2026 high of $82,820 serves as a key threshold to confirm a cycle low.
Despite the bullish momentum, warning signs have emerged among skeptics. Funding rates for leveraged long positions reached a 20-month peak, and CryptoQuant data indicates that short-term holder whales realized approximately $1.2 billion in profits between August 20 and 22. Additionally, exchange inflows rose to roughly 53,000 BTC, and trader unrealized profit margins reached 20.5%.
