PK Press Club — Needham & Co. said its “Crypto Euphoria Needham Diagram” (CEND) reached its highest levels since inception, indicating that market sentiment for cryptocurrencies is “very high right now » and approaches “extreme euphoria”.
The CEND Index, which tracks various metrics related to the crypto market cycle, recorded a reading of 64 this week, a significant increase from 55 in December 2024, but still below the high of 82 seen in October 2021 .
Needham’s analysis includes six underlying metrics that measure investor sentiment across retail, crypto-native and institutional, as well as “risk on” indicators such as Z-score and dominance of market value over realized value (MVRV).
These metrics aim to capture the level of fear of missing out (FOMO) and capital allocation to the riskier segments of the crypto universe. According to Needham, the current CEND figure is a sign of growing euphoria, which historically aligns with market highs.
“This week, CEND reached its highest levels since we began publishing the index,” the company said. “Almost every underlying metric we analyze to track the crypto cycle increased after Trump’s inauguration.”
The report notes that eight of the ten most downloaded financial apps were crypto-related, indicating increased interest from retailers. However, the rankings of Coinbase (NASDAQ:) and Robinhood (NASDAQ:) apps have declined since December 2024, while new competing apps are gaining ground.
The Bitcoin MVRV Z-score, a metric used to assess whether Bitcoin is overvalued or undervalued, remains high, suggesting that a large number of market participants are making profits.
Bitcoin dominance is also high, which Needham interprets as an indication of the early stages of a bull market, with investors not yet heavily allocated to riskier altcoins. On-chain leverage has increased since December, indicating greater risk-taking and euphoria among crypto natives.
Additionally, Google (NASDAQ:) search interest in “crypto” reached its highest levels since 2021, with a notable increase following former President Trump’s coin launch.
Finally, the street consensus on cryptocurrency-related stocks showed a significant rise, with an overall increase in “street buy consensus”, despite a more bearish outlook on Coinbase and notable bullish sentiment towards Bitcoin miners.
This trend “signals to us growing institutional euphoria/sell-off in crypto,” Needham analysts said.
