Data shows that positive sentiment around Bitcoin has spiked on social media after Bitcoin rebounded above $58,000, meaning investors may be feeling a fear of missing out.
The ratio of positive to negative sentiment towards Bitcoin has increased recently.
According to data from the analytics company saintThe public has recently shown a sudden surge of optimism about Bitcoin. The relevant indicator here is the “positive versus negative sentiment ratio,” which, as the name suggests, tracks the ratio of positive to negative comments on social media related to a particular coin.
The analytics company pulls posts/topics/messages from platforms like Twitter, Reddit, Telegram, and 4Chan. To determine whether these posts are negative or positive, Santiment puts them through a machine learning model.
When the index value is greater than 1, comments related to positive sentiments outnumber negative comments. On the other hand, an index value below the minimum indicates that most social media users share negative sentiments.
Now, here is a chart showing the trend in the ratio of positive to negative sentiment for the top two coins in the sector, Bitcoin and Ethereum, over the past few months:
As shown in the chart above, a significant spike in positive versus negative sentiment has been observed for Bitcoin after the cryptocurrency’s recent recovery.
The peak of this increase was twice as many positive posts as negative posts on major social media platforms. This is the first time the index has reached this high level.
While this suggests that investors are optimistic about the asset, the optimism metric could be worrisome. This is because Bitcoin has historically tended to go against the expectations of the majority, with the likelihood of a counter-move increasing as the public becomes more confident in the trend.
Since the positive sentiment has exploded after a slight price spike, the fear of missing out may take hold a little too soon. This could lead to a potential Bitcoin peak. As for when Bitcoin’s fate will turn bullish again, the analytics firm says:
We expect traders to slow down and start expressing their concerns and doubts again. When the public starts expressing their doubts again, Bitcoin will really start testing its all-time high market caps in March.
Interestingly, while Bitcoin’s fear of missing out is dominating social media, users are still showing a modest amount of optimism towards Ethereum. This could naturally play into Ethereum’s favor.
Bitcoin price
Bitcoin struggled to make a sustained move above $58,000, as the coin saw another rejection today at $57,800.