Bitcoin Stares Down Fourth Consecutive Monthly Loss as $1.7B Exits Funds
Institutional outflows hit $1.73 billion as Bitcoin decouples from equities and gold, risking a rare fourth month of declines.
Bitcoin Decouples From Macro Rally
Bitcoin is pacing for its fourth straight monthly decline. A streak of red candles not seen since the 2018 bear market. The asset struggled to hold $87,000 on Monday, erasing early January gains and signaling a decisive decoupling from traditional risk assets. While the S&P 500 and tech stocks have largely maintained their momentum, Bitcoin has shed approximately 11% from its January 14 peak of $97,000.
The divergence invalidates the “debasement trade” thesis that many institutional allocators relied on entering 2026. While gold surged to historic highs above $5,000 this week, digital assets failed to capture the same safe-haven bid.
Institutional Exodus: The Numbers
Data from CoinDesk and CoinShares reveals a sharp reversal in sentiment. Crypto investment products saw $1.73 billion in outflows last week, the largest single-week exit since mid-November 2025. Bitcoin bore the brunt of this capitulation:
- Bitcoin Funds: -$1.09 billion (net outflows).
- Ethereum Funds: -$630 million.
- Context: This marks a retreat from the “Trump Trade” optimism that characterized late 2025.
“The wave of redemptions reflects persistent bearish sentiment… and growing disappointment that digital assets have not yet benefited from the broader debasement trade.”
Market Mechanics
The price action suggests structural weakness rather than a specific catalyst. Unlike the 2022 collapse driven by Terra/Luna or FTX, this slide is “quiet”, driven by fading expectations for aggressive Federal Reserve rate cuts and a lack of new liquidity. With Bitcoin briefly dipping below $86,000 before stabilizing, the market is now testing support levels that, if broken, could accelerate deleveraging in the derivatives market ahead of the January 30 options expiry.
