#MCF Weekly Market Review (Jan 26 – Feb 1)
1. Market Performance
Crypto markets sold off sharply last week. On Jan 31,
#BTC broke key support, briefly falling to $75,700 and returning to prior lows.
#ETH underperformed, dropping below $2,400 with a 12.28% 24h decline.
The move triggered rapid deleveraging and large-scale liquidations across major on-chain players, including whales and long-biased institutions. Multiple factors contributed, including hawkish Fed expectations, cross-asset margin stress, and ETF outflows. Crypto continues to trade as a liquidity-sensitive risk asset.
2.
#ETF Flows
Spot Bitcoin ETFs recorded a record $1.49B in weekly net outflows, with
#IBIT accounting for $947M. Notably, outflows began before the major price breakdown, reinforcing downside pressure.
Total BTC ETF AUM stands at $106.96B (≈ 6.38% of BTC market cap). U.S. spot ETFs have now seen three consecutive months of net outflows. ETH ETF AUM also declined to $15.86B. Overall, ETF flows remain largely price-following, leaving demand fragile.
3. Macro Backdrop
•Trump’s nomination of Kevin Warsh as Fed Chair reinforced tightening and balance sheet contraction expectations.
•The Fed held rates steady, but hawkish guidance further cooled rate-cut hopes.
•Gold and silver reversed sharply after crowded positioning unwound.
•Easing Iran-related tensions briefly reduced geopolitical risk sentiment.
4. Outlook & Summary
The sell-off pushed sentiment back into extreme fear. Despite repeated washes since 2025, Bitcoin has shown weaker rebound elasticity, suggesting growing market fatigue.
Liquidations amplified downside risk, and BTC’s ability to hold prior lows remains uncertain. Near-term upside appears limited, with prices more likely to consolidate around $85,000. Market focus has shifted from scarcity narratives to liquidity signals, including policy direction, USD and real yields, and post-deleveraging capital flows.