TLDR
- Bitcoin ETFs experienced $483 million in outflows, with Grayscale’s GBTC leading.
- Ethereum ETFs had $230 million in outflows, ending a five-day streak of positive flows.
- The outflows came amid uncertainty from U.S.-EU trade disputes and global liquidity pressures.
- Analysts predict these outflows reflect temporary derisking, not long-term crypto rejection.
Spot Bitcoin and Ether exchange-traded funds (ETFs) in the U.S. experienced a combined net outflow of approximately $713 million on January 20, 2026. This sharp downturn came as broader market conditions were impacted by geopolitical tensions and global economic uncertainties.
Bitcoin ETFs Face Significant Outflows
Bitcoin ETFs recorded $483 million in net outflows across eight funds, with Grayscale’s GBTC and Fidelity’s FBTC leading the way. Grayscale’s GBTC saw the largest outflow, with $160.8 million exiting the fund. Fidelity’s FBTC followed with $152 million in outflows. This marks a continuation of the selling pressure that began on January 19, when Bitcoin ETFs saw $395 million in outflows.
These outflows reflect broader concerns in the financial market. Bitcoin’s price fell below the $89,000 mark, a drop from its previous highs of over $97,000. The downturn is attributed to a combination of global liquidity issues and rising tensions between major economic powers.
Ethereum ETFs Also Experience Major Outflows
Spot Ethereum ETFs saw $230 million in net outflows, ending a five-day streak of positive flows. BlackRock’s ETHA fund recorded a $92.3 million outflow, leading the decline in Ethereum-focused ETFs. Like Bitcoin, Ethereum’s price dropped below the $3,000 threshold, contributing to the outflows.
The drop in Ethereum prices is part of a broader slump in the crypto market, as traders responded to concerns over macroeconomic factors. While Ethereum had been experiencing positive inflows for several days, the outflows show how quickly market sentiment can shift due to global factors.
Geopolitical Tensions Contribute to Market Volatility
The outflows from both Bitcoin and Ether ETFs come amid escalating geopolitical tensions, particularly between the U.S. and the European Union. The trade dispute over control of Greenland remains unresolved, adding to market uncertainty. Additionally, Japan’s panic selling of government bonds has impacted global liquidity, further weighing on financial markets, including cryptocurrencies.
Peter Chung, Head of Research at Presto Research, mentioned that these conditions have affected both equities and cryptocurrencies. “The global market is facing a liquidity crunch, which has also put pressure on the crypto space,” Chung stated.
Temporary Derisking Rather Than Long-Term Rejection of Crypto
Despite the large outflows, many analysts view the situation as a temporary reaction to market conditions rather than a long-term rejection of crypto assets. Nick Ruck, Director at LVRG Research, said, “We see the current crypto market as undergoing a healthy consolidation phase after early volatility in 2026. Strong institutional infrastructure is in place, and inflows are likely to resume once macroeconomic conditions stabilize.”
Jeff Mei, COO at BTSE, also noted that while the market’s response to geopolitical events like Trump’s tariff threats over Greenland has caused some volatility, many believe that these issues will be resolved without significant harm to global markets. “Traders are watching closely how Europe will respond, but we expect the situation to calm down,” Mei added.
The market remains cautious, with many hoping that the current turbulence will subside. Analysts believe that as the geopolitical situation stabilizes, institutional investors will regain confidence and reinvest in the crypto space, leading to potential inflows in the future.
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