While the cryptocurrency markets entered 2026 with hope, the strong outflows in the last two weeks completely reversed the situation. A total outflow of $1.7 billion from digital asset investment products last week led to the erasure of all gains made since the beginning of the year. According to CoinShares data, fund flows on a global basis have decreased to minus 1 billion dollars since the beginning of the year. While this picture indicates a serious deterioration in investor perception, there are multiple structural and macro reasons behind the sales wave.
Fed, Whales and Geopolitical Risks
According to CoinShares’ report dated February 2, three main elements are at the heart of the selling pressure. The first of these was the sharp change in expectations for monetary policy, with the US Federal Reserve (Fed) appointing a more hawkish president. The postponement of hopes for interest rate cuts accelerated the outflow of risky assets such as crypto.
The second element is that large investors, called “whales”, continue the liquidation process based on the four-year cycle. The release of assets accumulated during previous bull periods increased supply pressure on an already fragile market structure. The third and perhaps the most critical factor was the escalating geopolitical tensions in different geographies. While the global uncertainty environment directed investors to safe havens, it seriously weakened the risk appetite in the crypto market.
Looking at regional data, it is seen that the biggest outflow occurred in the USA with 1.65 billion dollars. While Canada and Sweden also recorded significant outflows, limited inflows in Switzerland and Germany remained far from balancing the overall picture. This suggests that pessimism is intensifying in North America and Scandinavia, where institutional adoption was previously strong.
Dissolution in Bitcoin and Ethereum, Disintegration in Alternative Products
The locomotive of the sales was Bitcoin and Ethereum. There was an outflow of $1.32 billion from Bitcoin investment products and $308 million from Ethereum. Other major crypto assets such as XRP and Solana also could not escape this wave. Another notable development is the increasing interest in short Bitcoin positions; Since the beginning of the year, assets in these products have grown by more than 8 percent. This situation reveals that investors expect new declines in prices.
On the other hand, a different, albeit limited, news flow draws attention in the market. In the same period, there was an inflow of 15.5 million dollars into tokenized precious metal products. In particular, the increase in on-chain gold and silver sales shows that investors are turning to more defensive, hybrid instruments instead of volatile crypto assets. This development is important as it points to a selective capital rotation within the crypto market.
