Digital asset investment products recorded net outflows of $1.73 billion last week, marking the largest weekly decline since mid-November 2025, as bearish sentiment intensified amid heightened macroeconomic uncertainty.
The outflows were heavily concentrated in the United States, which accounted for nearly $1.8 billion, pointing to a significant pullback by U.S.-based investors.
Bitcoin investment products were the most affected, with $1.09 billion in outflows, while Ethereum products saw $630 million withdrawn over the same period. XRP investment products recorded $18.2 million in outflows. In contrast, several altcoin-related products attracted modest inflows, including Solana with $17.1 million, Chainlink with $3.8 million, and Binance-linked products with $4.6 million. Short-Bitcoin products recorded $0.5 million in inflows, suggesting limited hedging activity.
From a regional perspective, Switzerland recorded inflows of $32.5 million, Canada $33.5 million, and Germany $19.1 million. Meanwhile, Sweden saw outflows of $11.1 million, and the Netherlands recorded outflows of $4.4 million.
The sharp outflows coincided with more than $550 million in leveraged long liquidations, exacerbating downward pressure on crypto prices. During the sell-off, Bitcoin briefly dipped to $86,000, while Ethereum fell to around $2,785.
Derivatives markets reflected rising risk aversion. Put skews and implied volatility increased in Bitcoin options, with protection levels shifting from approximately $88,000 to $85,000, indicating stronger demand for downside protection.
Macro risks continued to weigh on sentiment. U.S. government funding is set to expire on January 30, raising the risk of a partial government shutdown, while prediction market odds imply roughly a 75% probability of a shutdown by January 31. Currency markets also remained in focus, with USD/JPY hovering around 154, a level traders view as approaching a potential intervention threshold at 160. The Federal Reserve is expected to hold interest rates steady, with investors closely watching upcoming guidance from Chair Jerome Powell.
In the near term, unresolved macroeconomic and geopolitical risks are likely to keep crypto prices volatile and range-bound until greater clarity emerges.
