Bitcoin ETFs: A Market Under Pressure
As January drew to a close, the U.S. Bitcoin exchange-traded fund (ETF) market continued to show signs of weakness. According to data from Farside Investors, Bitcoin ETFs experienced net outflows of approximately $19.6 million on January 28. While this was a smaller loss compared to earlier in the month, it reflects a trend of sustained caution among institutional investors.
The funds have struggled, posting only a single positive inflow day in the past eight trading days—a modest gain of $7 million. This downturn starkly contrasts the optimism seen in mid-January when Bitcoin ETFs attracted a combined $840.6 million in a single day. However, sentiment shifted sharply, culminating in $708.7 million leaving Bitcoin ETFs on January 21, the largest single-day outflow of the period.
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Ethereum ETFs: Stabilization Amid Volatility
In contrast to Bitcoin’s struggles, U.S. Ethereum ETFs exhibited signs of recovery by the end of January. On January 28, Ethereum ETFs recorded $28.1 million in net inflows, following a stronger day on January 26 with inflows of $117 million. This resurgence marks some relief after a volatile period when the largest daily outflow of $287 million, primarily from BlackRock’s iShares Ethereum Trust (ETHA), was registered on January 21.
Encouragingly, ETHA returned to net inflows on January 28, adding $27.3 million, with other funds halting their outflows. While the recovery is modest, it suggests Ethereum-linked funds are seeing reduced selling pressure compared to Bitcoin.
Macroeconomic Pressures Influence Crypto Markets
Bitcoin prices have struggled to recover, dipping below $88,000 as of late January. This came after a rejection at a key technical level and the Federal Reserve’s decision to leave its benchmark interest rate unchanged in the range of 3.50–3.75%. Fed Chair Jerome Powell reiterated that inflation remains above the 2% target, reinforcing expectations of cautious monetary policy in the near term.
Geopolitical tensions have also hampered risk appetite, further weighing on cryptocurrencies. Developments in the Middle East, including potential U.S. military action against Iran, have driven investors toward safe-haven assets like gold and silver. In response, gold prices have hit all-time highs, while risk-sensitive assets such as Bitcoin and Ethereum continue to see fluctuating demand.
Stay Informed in a Fast-Moving Market
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