Digital asset investment products experienced a significant pullback as of January 26, with investors withdrawing a total of $1.73 billion. According to CoinShares, this marks the largest outflow since mid-November 2025.
Market watchers attribute the decline to fading expectations of interest rate cuts, negative price momentum, and disappointment that cryptocurrencies have not participated in broader macro trends related to currency debasement.
The United States bore the brunt of withdrawals, with nearly US$1.8 billion exiting investment products. Smaller outflows occurred in Sweden ($11.1 million) and the Netherlands ($4.4 million).
Source: CoinShares
Meanwhile, Switzerland, Germany, and Canada recorded inflows of $32.5 million, $19.1 million, and $33.5 million, respectively, as traders added positions amid lower prices.
Bitcoin saw the largest outflow at $1.09 billion, marking the most substantial withdrawals since November 2025. Minor inflows of $0.5 million to short-Bitcoin products indicate traders are hedging, but sentiment remains weak following the October 10, 2025, price crash.
Ethereum and XRP also experienced declines, with $630 million and $18.2 million leaving the market, respectively.
Source: CoinShares
In contrast, Solana recorded inflows of $17.1 million, while Binance and Chainlink saw smaller gains of $4.6 million and $3.8 million. Analysts note that this mixed pattern shows selective optimism rather than a broad market recovery.
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According to a report by CryptoQuant, the open interest in Bitcoin derivatives on Binance is high, at about $10.78 billion.
The market has takers willing to buy (long) at $5.16 billion and takers willing to sell (short) at $5.68 billion, slightly more selling. The long/short ratio of 0.91 indicates a slightly bearish sentiment, but not in an oversold region.
Source: CryptoQuant
The open interest to volume ratio is 0.99, indicating a highly leveraged market that can move rapidly. Market participants are holding on to their positions, and there is ample liquidity.
Market analysts have indicated that a highly leveraged market with increasing selling pressure could result in rapid liquidations if market conditions deteriorate further.
Investors should watch derivatives leverage and outflows, as elevated open interest increases the likelihood of sudden market swings.
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