Crypto Markets Hit by Heavy Outflows Amid Macro Uncertainty
Spot Bitcoin and Ether exchange-traded funds (ETFs) hemorrhaged capital on Tuesday as a wave of macroeconomic anxiety and geopolitical tension sent investors scrambling for the exits. The sharp reversal in sentiment comes as global liquidity tightens, weighing heavily on risk assets across the board.
Major Outflows Across Leading Crypto Funds
According to data from SoSoValue, spot Bitcoin ETFs recorded a staggering $483.4 million in daily outflows. The selling pressure was broad-based, with the Grayscale Bitcoin Trust (GBTC) leading the decline, shedding $160.8 million. Fidelity’s Wise Origin Bitcoin Fund (FBTC) wasn’t far behind, seeing $152 million exit the fund.
Ethereum products fared no better. Spot Ether ETFs posted $230 million in net outflows, abruptly snapping a five-day streak of positive inflows. BlackRock’s ETHA fund alone saw $92.3 million withdrawn. The bearish sentiment extended to XRP ETFs, which logged their largest single-day outflow to date at $53.3 million. However, Solana products managed to buck the prevailing trend, recording a modest $3 million in net inflows despite the wider market rout.
Global Liquidity and Geopolitics Drive Risk-Off Mood
The retreat in digital assets coincides with a broader weakening of market prices. Bitcoin slipped back under the $89,000 mark—a sharp pullback from highs exceeding $97,000 just last week—while Ether traded below $3,000.
Vincent Liu, Chief Investment Officer at Kronos Research, noted that the ETF exodus reflects deep institutional caution. “The outflows reflect institutional caution regarding geopolitical tariffs and a general risk-averse climate,” Liu told Cointelegraph. He highlighted specific pressure points in the bond market, adding, “Japanese bond selling and rising JGB yields are tightening global liquidity and weighing on risk assets.”
Analysts are also pointing to escalating trade tensions between the United States and Europe regarding Greenland as a key source of friction. These geopolitical stressors, combined with the panic selling of Japanese government bonds, have created a hostile environment for liquidity-dependent assets.
Whales Accumulate While Retail Sells
Despite the gloomy price action, on-chain data suggests a divergence in behavior between large and small investors. While “retail” wallets holding less than 0.01 BTC have been reducing their exposure, larger entities are buying the dip.
According to Santiment, addresses holding between 10 and 10,000 BTC have collectively added approximately 36,300 Bitcoin to their stacks over the past nine days, suggesting high-conviction holders remain unfazed by the short-term volatility.
Contrasting Moves in Leveraged Equities
While the crypto sector faced headwinds, some segments of the equity market showed resilience. In the leveraged ETF space, the Direxion Daily CSI China Internet Index Bull 2X Shares (CWEB) managed to close up 1.46% at $43.91, gaining $0.62 on the day.
This fund, designed to deliver 200% of the daily performance of the CSI Overseas China Internet Index, creates long positions by investing at least 80% of its assets in the securities comprising the index. Its positive performance highlights a pocket of opportunity where traders are still willing to take on significant exposure to the Chinese internet sector despite the broader “risk-off” atmosphere affecting digital currencies.
All Eyes on Jobless Claims
Market participants are now turning their attention to upcoming economic data to gauge the Fed’s next moves. Traders are specifically focused on the U.S. initial jobless claims report scheduled for Thursday, January 22, at 8:30 a.m.
Liu warned that the data could be a double-edged sword. A weaker-than-expected number could reinforce concerns about slowing growth, potentially deepening the current risk aversion and adding further pressure to both traditional and digital markets.
