Reversal and Anti-Collision — The momentum of ETF inflows has suddenly changed, causing fluctuations in the market

Digital asset investment products experienced record capital inflows last week led primarily by Bitcoin, but the momentum sharply reversed over the weekend. According to CoinShares data, a net inflow of $2.17 billion was recorded, reaching the highest weekly total since October 2025. However, renewed geopolitical risks caused market sentiment to fluctuate significantly afterward. This event symbolizes the limitations of ETFs as anti-hedges in the cryptocurrency market.

Market supported by surging ETF funds—Bitcoin, Ethereum, and Solana move in tandem

Throughout the previous week, institutional crypto funds continued to see steady capital inflows. Bitcoin-related funds attracted $1.55 billion, while Ethereum absorbed an additional $496 million, and Solana received $45.5 million. This pattern of inflows is notable amid ongoing debates over stablecoins and yield policies.

For market participants, inflows into these funds served as a bullish catalyst. The Bitcoin-led inflow indicates that institutional investors still maintain fundamental confidence in cryptocurrencies. The high concentration in Bitcoin suggests a preference for mainstream assets over contrarian strategies.

Reversal over the weekend—geopolitical risks and policy uncertainties shake the market

However, the upward trend did not last. On Friday, capital flows abruptly reversed, with rising geopolitical tensions and threats related to tariff policies resurfacing. Including new tensions related to Greenland issues, the overall investment products experienced a $378 million outflow.

CoinShares’ research head James Butterfill points out that policy uncertainty underpins this reversal. The increased likelihood that Kevin Hasset, considered a candidate for the next Federal Reserve Chair, will remain in office caused market confusion over policy signals. These external factors shifted market dynamics, turning previous buying demand into an anti-hedge, triggering the reversal.

Inflow and outflow patterns by region—U.S. dominance remains strong

Regional capital flows reveal that the U.S. market continues to dominate. Inflows to the U.S. reached $2.05 billion, accounting for most of the total. Meanwhile, gradual positive inflows are also seen in regions such as Germany ($63.9 million), Switzerland ($41.6 million), Canada ($12.3 million), and the Netherlands ($6 million).

This regional pattern suggests that global institutional investors still hold significant interest. However, the high concentration in the U.S. market also increases sensitivity to geopolitical risks and policy changes. In other words, the U.S.-centered fund composition acts as an anti-factor that can accelerate declines during reversals.

Small movements in altcoins—XRP leads anti-inflows

Altcoin capital flows are relatively limited but show notable activity. XRP attracted the largest inflow of $69.5 million, while Sui, Lido, and Hedera also absorbed modest funds. However, according to the latest market data (as of January 29, 2026), XRP has already experienced nearly 4% decline since the start of the month, with a further -1.87% drop in the past 24 hours.

This gap indicates that even XRP, considered an anti-asset, cannot resist market sentiment reversal. The phenomenon of inflows being pushed down despite buying pressure suggests that market psychology and sentiment shifts are more dominant than mere capital volume.

Limited anti-hedging via stock market

Blockchain-related stocks, excluding token funds, attracted $72.6 million. Despite rising headline risks, investors continue to seek exposure to cryptocurrencies through publicly traded proxy products. While this can serve as an anti-volatility strategy, the inflow remains limited.

What lies beyond the market reversal

Last week’s events reaffirm that, in the crypto market, sustained capital inflows are powerless against geopolitical risks and policy uncertainties. The interplay of reversals and anti-trend elements is likely to be a key theme influencing future market developments. The ongoing tug-of-war between institutional fund inflows and market sentiment shifts will determine the market direction.