Crypto exchange-traded products (ETPs) have experienced a dramatic reversal, nearly wiping out the $1.5 billion in inflows that they garnered at the start of 2026. According to a recent report from digital asset manager CoinShares, the downturn has been particularly steep, with $1.3 billion lost over a mere four-day period. This represents a significant setback for the crypto market, as these products faced a combined outflow of $454 million in just the last week alone.
The overall weakness has primarily affected Bitcoin exchange-traded funds (ETFs), which saw outflows totaling $405 million last week. This withdrawal came amidst a broader reassessment among investors regarding near-term expectations for Federal Reserve interest rate cuts. Short-Bitcoin funds also faced a minor outflow of $9.2 million, indicating varying sentiments concerning the asset’s potential in the marketplace.
Despite these losses, Bitcoin recently traded at $91,722, with a slight gain of 1% recorded in the past day, as reported by crypto price aggregator CoinGecko. James Butterfill, head of research at CoinShares, attributed the negative sentiment to diminishing hopes for a Fed rate reduction in March. Market speculation leading up to the Federal Open Markets Committee’s upcoming meeting on January 27-28 suggests a 95% probability that the Fed will leave rates unchanged. This is a notable decline from the previous week, when futures data indicated a 44% chance of a rate cut in March, which has since dropped to just 26.2%.
Investors on prediction platforms, such as Myriad, remain hopeful for a potential rate cut, believing there is a 59% probability that the FOMC might implement a 25-basis point reduction before July.
While Bitcoin and Ethereum ETFs faced significant outflows, altcoin products bucked the trend, showing positive momentum. XRP, Solana, and Sui products attracted new inflows of $45.8 million, $32.8 million, and $7.6 million, respectively. Notably, at the time of the report, XRP was trading at $2.07, and Sui was slightly lower at $1.80. Solana, meanwhile, experienced a gain of 2.2%, with its price hovering around $142.
As investors navigate the shifting landscape of crypto assets, it remains to be seen how evolving economic conditions and market sentiment will influence future inflows and the stabilization of exchange-traded products.
