Bitcoin ETFs lost $817.9M and Ethereum ETFs shed $155.6M on January 29th as BTC crashed to $81K, triggering massive liquidations and institutional exit.

Bitcoin and Ethereum ETFs Lose Nearly $1 Billion in Single Day

US-listed spot Bitcoin and Ethereum exchange-traded funds experienced their worst single-day outflow since November 20th, with nearly $1 billion yanked from the products on January 29th as cryptocurrency prices tumbled and institutional risk appetite evaporated. According to SoSoValue data, Bitcoin ETFs alone recorded $817.9 million in net outflows, while Ethereum ETFs shed an additional $155.6 million, bringing the combined total to $973.5 million.

BlackRock's IBIT, the largest Bitcoin ETF with over $69 billion in assets, bore the brunt of the selling pressure, losing $317.8 million in a single session. Fidelity's FBTC followed with $168 million in redemptions, while Grayscale's GBTC saw $119.4 million exit. Smaller products from Bitwise, Ark 21Shares, and VanEck also posted meaningful outflows, signaling broad-based institutional retreat rather than isolated fund rotation.

Ethereum ETFs experienced similar pain. BlackRock's ETHA lost $54.9 million, Fidelity's FETH saw $59.2 million in withdrawals, and Grayscale's Ethereum products continued hemorrhaging assets. Total Ethereum ETF holdings fell to $16.75 billion, down from over $18 billion earlier in January—a decline of roughly 7% in less than a month.

The outflows coincided with a sharp price collapse across crypto markets. Bitcoin fell through critical support at $85,000 and briefly touched $81,000 during US trading hours before stabilizing near $83,000 in Asian markets on Friday. Ethereum dropped more than 7% on the day, falling below $2,600 at its lowest point. The synchronized selling across both Bitcoin and Ether ETFs suggests institutions were reducing overall crypto exposure rather than rotating capital between assets—a marked shift from earlier in January when Ethereum inflows sometimes offset Bitcoin weakness.

The selloff was triggered by a confluence of macro headwinds. The Federal Reserve held interest rates steady at 3.5-3.75% and signaled limited appetite for near-term cuts, disappointing markets that had priced in more dovish policy. Chair Jerome Powell's press conference reinforced expectations that the Fed would remain cautious on easing, citing persistent inflation pressures and a resilient labor market. Rising implied volatility, weakness in equities, and speculation around future Fed leadership—including reports that Kevin Warsh, considered bearish for Bitcoin, could replace Powell—all weighed on sentiment.

Geopolitical tensions added fuel to the fire. President Trump threatened 100% tariffs on Canadian imports and deployed naval forces toward Iran, while trade disputes with Europe escalated. These developments drove capital into traditional safe-haven assets like gold, which surged above $4,400 per ounce, leaving risk assets like Bitcoin vulnerable.

The price breakdown triggered massive forced liquidations. Roughly $180 million in leveraged long positions were liquidated within an hour after Bitcoin broke below the 100-week simple moving average near $85,000—a level that had acted as critical support. Thin liquidity amplified the move, creating a self-reinforcing sell-off as stop-losses cascaded and market makers pulled bids.

Andri Fauzan Adziima, Research Lead at Bitrue, described the event as "a leverage shakeout amid macro pressure, not the start of a bear market." He noted that Bitcoin's crash was driven by a risk-off wave combining hawkish Fed policy, heavy ETF outflows exceeding $1 billion recently, geopolitical tensions, and a brief dip in gold and silver that reduced safe-haven demand for alternative stores of value. "This triggered massive leveraged liquidations after breaking key support, creating a self-reinforcing sell-off in thin liquidity," Adziima said, adding that rebound potential exists if supports hold.

The reversal is particularly stark given how 2026 began. Bitcoin ETFs attracted $1.2 billion in net inflows during the first two trading days of the year, driven by BlackRock, Fidelity, and Grayscale, signaling renewed institutional interest after a difficult end to 2025. That narrative crumbled quickly, with outflows accelerating throughout January and culminating in this week's record exodus.

Total cumulative inflows for US spot Bitcoin ETFs since launch now stand at approximately $57.5 billion, though net asset values have fluctuated with Bitcoin's price volatility. The January 29th outflow represents the largest single-day redemption since the products launched in January 2024, surpassing even the heavy selling seen during November's $3.48 billion monthly outflow period.

For now, the data confirms that institutional conviction remains fragile. While Bitcoin's long-term adoption thesis hasn't changed, near-term flows are driven by macro sentiment, leverage dynamics, and Fed policy expectations—all of which currently point toward caution rather than accumulation.