Cryptocurrency investment products faced heavy outflows on Thursday as the total crypto market capitalization fell about 6%.
Bitcoin (BTC) and Ether (ETH) funds recorded nearly $1 billion in outflows, among the largest of the year so far, according to SoSoValue.
Spot Bitcoin exchange-traded funds (ETFs) led the sell-off, shedding $817.9 million, exceeding last Wednesday’s $708.7 million outflows and marking the largest daily outflow since November 2025.
The crypto decline coincided with broader market weakness, including a 4% drop in gold after a recent surge above $5,300, according to data from TradingView.
Industry observers linked the market slump to fresh tariff threats by US President Donald Trump and concerns over AI-related tech stocks amid Microsoft shares plunging 10%.
January flows turn negative after $1 billion in outflows
Bitcoin funds extended losses this week after a series of outflows, including $147.4 million on Tuesday and $19.6 million on Wednesday.
By Thursday, cumulative weekly outflows had reached $978 million, pushing Bitcoin ETF flows into negative territory for January after another roughly $1 billion in outflows last week.
Overall, spot Bitcoin ETFs have recorded about $1.1 billion in net outflows so far this month, according to SoSoValue data.
Despite the sell-off, Bitcoin ETFs remain a significant part of the market. With $107.65 billion in assets under management (AUM), they account for about 6.5% of Bitcoin’s total market capitalization of roughly $1.65 trillion.
Altcoin funds extend losses, with outflows across ETH and XRP
Negative sentiment persisted across altcoin investment products, with spot Ether ETFs logging $155.6 million in outflows, while XRP (XRP) funds shed $92.9 million.
Solana (SOL) ETFs saw more modest outflows of $2.2 million, following inflows of about $10 million earlier in the week.
With $16.75 billion in AUM, Ether ETFs account for around 5% of the asset’s market capitalization of approximately $330 billion.
According to an update by CoinShares, total AUM in crypto exchange-traded products (ETPs) stood at $178 billion by the end of last week, accounting for 5.7% of the entire market cap.
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At the time of writing, total crypto market capitalization stood at about $2.92 trillion, with nearly $200 billion erased since peaking above $3 trillion a day earlier.
Alongside Microsoft’s impact on the broader market sell-off, blockchain analytics firm CryptoQuant cited high leverage exposure as a key factor in the crypto downturn.
CryptoQuant’s analyst Darkfost specifically pointed to high leverage positions at the decentralized derivatives exchange Hyperliquid, with $87.1 million in long positions wiped out within just a few hours.
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