The dawn of 2026 has brought renewed optimism to the cryptocurrency market in the form of the ‘January Effect.’ After a turbulent end to 2025, marked by over $6 billion in combined outflows during November and December, institutional investors have returned, sparking significant inflows into Bitcoin and Ethereum ETFs.
What is the ‘January Effect’?
The January Effect is widely recognized in financial markets as a trend where asset values revive after a subdued period. This phenomenon is now being observed in the digital asset sector as well, with Bitcoin and Ethereum ETFs experiencing remarkable first-day trading activity in 2026.
Record-Breaking Inflows
According to data from Farside Investors, US-based spot Bitcoin and Ethereum ETFs saw a combined net inflow of $645.8 million on January 2, 2026. BlackRock’s IBIT ETF led the pack for Bitcoin, logging $287.4 million of the total $471.3 million inflow. Meanwhile, Grayscale’s ETHE made headlines with $53.7 million in net inflows for Ethereum, surpassing BlackRock’s ETHA on that day.
This surge also marked the largest single-day inflow for U.S.-listed Bitcoin ETFs in 35 trading days—the strongest since November 11, 2025. Spot Ethereum ETFs followed closely, recording their highest influx in 15 trading days, with the previous high being $177.7 million on December 9, 2025.
A Gradual Recovery for Bitcoin and Ethereum Prices
Bitcoin and Ethereum have shown resilience as trading resumed in 2026. After a stagnant December, Bitcoin prices climbed 1.87% in the last 24 hours to $91,337.49, while Ethereum regained $3,140.08 with a 1.51% increase, as per CoinMarketCap. Analysts suggest this uptrend could be a precursor to a larger crypto bull run if institutional accumulation continues at the current pace.
However, this comes in the wake of October 2025’s catastrophic single-day liquidation event, which erased $20 billion in market value. While the cryptocurrency market appears to be bouncing back, many investors are cautiously optimistic, keeping an eye on potential triggers for sustainable growth.
Spotting Market Trends
For those looking to remain informed and ahead of the curve, a premium crypto tracking tool like CoinGecko or CoinMarketCap can provide real-time data, helping users monitor market shifts effectively. Additionally, BlackRock and Grayscale ETFs remain reliable choices for institutional exposure to Bitcoin and Ethereum for those wishing to capitalize on this strong start to the year.
Does This Signal a Bull Run?
The big question for 2026 is whether this surge signals the start of a long-term bull run for Bitcoin and Ethereum. Optimists believe that continued institutional interest and significant inflows could push both cryptocurrencies toward new all-time highs (ATHs). However, skeptics urge caution, as market trends remain subject to various macroeconomic and regulatory factors.
Whether you’re an investor or an observer, keeping an eye on institutional moves and market inflows will be critical in gauging the cryptocurrency market’s direction in 2026.
