Crypto Market Faces $1B Outflows Amid Major Sell-Off
By John Nada·Jan 30, 2026·3 min read
Crypto investment products saw nearly $1 billion in outflows as the total market cap dropped 6%. The sell-off highlights ongoing volatility in the crypto space.
Cryptocurrency investment products experienced significant outflows on Thursday, as the total crypto market capitalization dropped approximately 6%. Bitcoin (BTC) and Ether (ETH) funds saw nearly $1 billion in outflows, marking one of the most substantial declines of the year, according to SoSoValue. Spot Bitcoin exchange-traded funds (ETFs) led the charge, shedding $817.9 million, surpassing last Wednesday’s $708.7 million outflows and representing the largest daily outflow since November 2025.
The downturn in the crypto market coincided with broader financial market weakness, including a 4% decrease in gold, which had recently surged above $5,300, according to TradingView data. Analysts have linked this slump to new tariff threats posed by US President Donald Trump and concerns surrounding tech stocks, particularly after Microsoft shares dropped by 10%.
This decline marks a troubling trend for Bitcoin funds, which have extended their losses this week following a series of withdrawals, including $147.4 million on Tuesday and $19.6 million on Wednesday. By Thursday, cumulative weekly outflows reached $978 million, pushing Bitcoin ETF flows into negative territory for January after an additional $1 billion in outflows were recorded last week. Overall, spot Bitcoin ETFs have seen about $1.1 billion in net outflows so far this month, according to SoSoValue.
Despite the sell-off, Bitcoin ETFs continue to play a vital role in the market. With $107.65 billion in assets under management (AUM), they represent approximately 6.5% of Bitcoin’s total market capitalization, which stands at around $1.65 trillion. Negative sentiment also affected altcoin investment products, with spot Ether ETFs logging $155.6 million in outflows and XRP (XRP) funds losing $92.9 million. Solana (SOL) ETFs experienced more modest outflows of $2.2 million after prior inflows of about $10 million.
Ether ETFs, with $16.75 billion in AUM, account for around 5% of the asset’s market capitalization of about $330 billion. According to an update by CoinShares, total AUM in crypto exchange-traded products (ETPs) reached $178 billion by the end of last week, making up 5.7% of the entire crypto market cap.
At the time of writing, the total crypto market capitalization was about $2.92 trillion, a decline after peaking above $3 trillion just a day earlier. Alongside the drop in Microsoft’s stock impacting the overall market, blockchain analytics firm CryptoQuant identified high leverage exposure as a significant factor in the crypto downturn. Analyst Darkfost pointed to considerable leverage positions at the decentralized derivatives exchange Hyperliquid, noting that $87.1 million in long positions were wiped out in just a few hours.
The current outflows and market instability signal a challenging environment for cryptocurrency investors, as both macroeconomic factors and specific market dynamics continue to exert pressure. The implications for the market are substantial, as negative sentiment and outflows could hinder recovery efforts in the crypto space.
In conclusion, the recent outflows underscore the volatility that characterizes the cryptocurrency market, emphasizing the need for investors to remain vigilant amid external pressures and internal market shifts.