Crypto market sentiment has dropped after hitting a multi-month high, as the crypto industry in the US is divided over a Senate version of a highly-awaited crypto market structure bill.
The market sentiment-tracking Crypto Fear & Greed Index, slid by 12 points on Friday to a “neutral” score of 49 out of 100, dropping from its score of 61, indicating “greed,” on Thursday.
The index’s score on Thursday was the highest recorded since it hit 64 out of 100 on Oct. 10, the same day the crypto market massively crashed and saw $19 billion in liquidations.
The index’s multi-month high on Thursday came as Bitcoin (BTC) gained around 5% over the day to $97,870.
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Crypto sentiment platform Santiment said on Thursday that the move “appeared more than justified based on continued smart money accumulation, and retail traders dumping.”
However, crypto sentiment on social media began to waver after several executives aired concerns about a Senate version of crypto market structure legislation that was due to be marked up on Thursday.
The bill would divvy up how US market watchdogs would regulate crypto, but some crypto lobbyists were upset at some provisions, especially one that further restricts stablecoin yields.
Many were prepared to still support the bull, but Brian Armstrong, the CEO of major crypto lobbyist Coinbase, pulled his support for it, saying it “would be materially worse than the current status quo” and would rather “no bill than a bad bill.’
After the backlash, the Senate Banking Committee cancelled its markup of the bill planned for Thursday, saying it needed more time to get support for the bill, and did not share when or if the markup would be rescheduled.
It came the same week as the Senate Agriculture Committee pushed its planned Thursday markup of the bill to late January, also citing the need to gain more support for the bill.
The bill is a major talking point in the crypto industry, and concerns around it can lead market participants to anticipate price declines, which often drives sentiment down.
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However, some industry participants see the postponement as a positive sign for the industry.
Crypto venture capitalist Kyle Chasse said on Friday that the delays are “a BULLISH signal.”
“Everyone thought that the market was going to get REKT after the news broke,” he said, emphasizing that “it didn’t,” and it is “actually holding up.”
Bitcoin is trading at $95,480 at the time of publication, dropping 0.83% over the past 24 hours, according to CoinMarketCap.
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