At the center of the move, Nasdaq Crypto Index slid to around 4,495, down more than 2.3%, reflecting weakness across Bitcoin, Ethereum, and large-cap altcoins. Bitcoin dropped close to 2.7%, hovering near $92,500, while Ethereum lost about 3.6% to trade near $3,190. XRP, Litecoin, and other major tokens also recorded losses between 1.5% and 3%.
The primary catalyst for this week’s volatility stems from a sudden shift in the macroeconomic landscape. Geopolitical uncertainty surrounding President Donald Trump’s proposal to acquire Greenland—and the subsequent threat of tariffs against European nations—has sent shockwaves through both equity and digital asset markets.
As investors pivoted toward traditional safe havens like gold, which surged to record highs above $4,600, Bitcoin saw nearly $500 million in leveraged long positions liquidated in a single hour. This flash crash has redefined the short-term outlook, as analysts watch for a potential bottom between $71,000 and $84,000.
The current price action reveals a stark reality: Bitcoin is currently tracking more closely with risk assets than as a “digital gold” hedge. As the BTC/USD pair dropped nearly 5.3% this month, the market witnessed record-breaking liquidations. Total crypto long liquidations topped $525 million on the back of news that the U.S. might impose a 10% tariff on several NATO members. This move has reignited trade war anxieties, pressuring not just Bitcoin, but Ethereum (ETH) and Solana (SOL) as well.
Ethereum has seen even steeper declines than the market leader, falling below the $3,100 mark as it shed nearly 4% of its value in a 24-hour window.
Market participants are increasingly cautious, with the Crypto Fear & Greed Index lingering in “Fear” territory. While some altcoins like XRP have shown relative resilience, trading near $1.93 with smaller percentage drops, the overall trend suggests a “Wave IV” corrective structure. Technical experts warn that unless buyers step in to reclaim the $104,000 level, the market could see another leg lower before any meaningful recovery begins.
This sell-off follows several sessions of range-bound trading and arrives amid thin liquidity, ETF outflows, and growing debate over whether Bitcoin is forming a corrective base or preparing for another leg lower. While long-term sentiment remains constructive, near-term signals point to caution.
Crypto prices fall across the board as market cap drops 3%
The latest price action shows synchronized declines across large-cap cryptocurrencies. Bitcoin traded between $91,000 and $93,000, depending on venue, marking one of its weakest daily closes this month. Ethereum slipped below key short-term support near $3,200, raising concerns about deeper consolidation.
Among other majors, Dogecoin fell nearly 8% to around $0.126, making it the worst performer among top-10 tokens. Solana declined about 6.7% to $133, while Tron proved relatively resilient, down just 0.5% near $0.317.
The damage extended well beyond the top tier. Within the top 100 coins by market value, 10 tokens posted double-digit losses. Aster fell roughly 12.7%, while Sui dropped around 12.5%. Only a handful of assets traded higher, led by Dash, which gained over 9%, and Monero, up about 6%.
Market breadth remains a key concern. When nearly all large tokens decline simultaneously, it often signals macro-driven selling rather than asset-specific news. Traders point to ETF flows, derivatives positioning, and reduced weekend liquidity as contributing factors.
Bitcoin technical outlook signals consolidation, not panic
Despite the sharp daily move, analysts caution against interpreting the decline as the end of the broader bull cycle. According to market technicians, Bitcoin is currently in Wave IV of a larger multi-year uptrend. This corrective phase typically involves choppy price action and multiple retests of support.
John Glover, Chief Investment Officer at Ledn, recently noted that the current corrective structure resembles a classic A-B-C pattern, with potential downside targets between $71,000 and $84,000 if selling pressure accelerates. Importantly, this scenario still fits within a bullish long-term framework.
For upside confirmation, analysts are watching a decisive close above $104,000, which would suggest the start of Wave V, often the strongest phase of a bull market. Until then, Bitcoin may continue to trade sideways or drift lower as buyers wait for clearer signals.
On-chain data adds nuance. Bitcoin’s network growth has slowed, and hash rate recently touched multi-month lows, though whale selling has moderated. These mixed signals reinforce the idea of consolidation rather than capitulation.
US crypto ETFs show heavy Bitcoin outflows, modest Ethereum inflows
Institutional flows remain a major driver of near-term price action. US-listed spot Bitcoin exchange-traded funds ended last week with $394.68 million in net outflows, snapping a recent streak of inflows. Total cumulative net inflows fell below $58 billion, settling near $57.82 billion.
Out of twelve Bitcoin ETFs, only one recorded positive flows. BlackRock led with inflows of about $15 million, while Grayscale saw the largest outflows at over $205 million, followed by Bitwise at roughly $90 million.
Ethereum ETFs painted a more stable picture. On January 16, US spot Ether ETFs collectively posted $4.64 million in inflows, marking their fifth consecutive day of net positives. Total net inflows held steady near $12.9 billion, with BlackRock again leading on the upside and Grayscale recording modest redemptions.
The divergence suggests investors are selectively reallocating rather than exiting crypto exposure entirely, favoring Ethereum’s ecosystem growth and staking narrative over near-term Bitcoin volatility.
Adoption headlines contrast with short-term market weakness
Even as prices retreat, adoption and institutional interest continue to build. Mortgage lender Newrez announced plans to allow qualifying borrowers to include Bitcoin, Ethereum, and select stablecoins as assets in its mortgage underwriting process. The policy, expected to roll out in February, will apply across non-agency products, including home purchases and refinancings, without requiring borrowers to liquidate their crypto holdings.
In the corporate sector, reports indicate Anchorage Digital is exploring a funding round of up to $400 million ahead of a potential IPO, signaling continued confidence in regulated crypto infrastructure. Meanwhile, Steak ’n Shake disclosed a $10 million Bitcoin purchase for its treasury, adding to the growing list of companies using crypto as a balance-sheet asset.
These developments highlight the ongoing disconnect between short-term price action and long-term adoption trends. While sentiment remains cautious and further downside cannot be ruled out, structural support for digital assets continues to strengthen beneath the surface.