Crypto Market Tumbles: Unpacking the January 23, 2026 Downturn

Crypto's red day hits hard. The digital asset market is taking a significant dive today, January 23, 2026, with major coins across the board flashing red. The question on every trader's mind is simple: what's driving the sell-off?

The Liquidity Squeeze

Market-wide pressure suggests a classic liquidity crunch. When risk assets globally get shaky, crypto often feels the pinch first and hardest. It's not just retail panic; institutional money is pulling back, searching for safer harbors—or at least, what passes for safe in today's volatile landscape.

Regulatory Headwinds Bite

Fresh regulatory murmurs from major economies are adding fuel to the fire. Ambiguous statements from watchdogs can trigger algorithmic sell-offs faster than any human trader can react. It's the old game of regulatory uncertainty, just with newer, more volatile tokens.

Technical Breakdowns Amplify Losses

Key technical support levels have been breached, triggering a cascade of automated selling. These moves are self-fulfilling prophecies written in code—once certain price points fall, the machines take over, pushing the market down further in a feedback loop of pure, emotionless logic.

The Macro Picture Looms Large

Never forget that crypto doesn't trade in a vacuum. Broader economic indicators, from inflation data to central bank chatter, are casting a long shadow. Digital assets remain, for all their disruptive promise, deeply tied to the old-world financial currents they seek to bypass.

So, is this a buying opportunity or the start of a deeper correction? The bulls will call it a healthy shake-out, flushing out weak hands. The bears see a reality check. One cynical truth remains: in crypto, the 'why' behind a crash is often crafted in hindsight by the same voices that failed to predict it. Today's fear is just tomorrow's forgotten chart blip for those with the stomach to hold.

Crypto Winners & Losers

As of Friday morning (UTC), 8 of the top 10 coins per market capitalisation have seen their price drop over the past 24 hours.

fell by 0.4%, currently trading at $89,477. This is the smallest drop on the list,

decreased by 2%, changing hands at $2,945. This is the second-highest drop in the category.

The highest fall among the top 10 is2.2%, now standing at $1.91.

On the other hand, two coins are currently green.appreciated by 3.3% to the price of $0.309.

is technically also green, but its increase is so low that the price is practically unchanged. It’s up 0.1% to $890.

At the same time, of the top 100 coins per market cap, 70 have seen their price drop today.

fell the most among these: 6.4% to $0.002481.

It’s followed bywith a 4.2% drop to $0.0242.

On the green side,appreciated the most: 8.4% to $0.00997.

is next, with a rise of 7.4% to $49.83.

Meanwhile, in the US,Chairman Paul Atkins andChairman Michael Selig will hold a joint event on 27 January to discuss ending regulatory chaos, as well as efforts to make the United States the global crypto capital.

“For too long, market participants have been forced to navigate regulatory boundaries that are unclear in application and misaligned in design, based solely on legacy jurisdictional silos,” the chairmen said in their statement.

I'm looking forward to joining @ChairmanSelig next week at our @SECgov and @CFTC joint event to discuss harmonization between our two agencies.

Together we will discuss our efforts to deliver on President Trump’s promise to make the US the crypto capital of the world.

Join us! https://t.co/qgJwmiHYus

How Will Ukraine-Russia Talks Influence Markets

According toanalysts, the recent developments around the Russia-Ukraine war may be beneficial for the markets, but possibly only in the short term. The US will facilitate talks between Ukraine and Russia in Abu Dhabi today.

At the macro level, analysts say, “this initiative may help ease markets’ tail-risk fears of a full-scale escalation in the NEAR term, but it does not imply a rapid end to the conflict.” A limited ceasefire could be more realistic.

Moreover, geopolitical risk premia could ease in the short term, supporting risk assets and dampening volatility in energy prices, they add.

Yet, the symbolism of these talks may outweigh any immediate breakthroughs. Over the medium term, “markets will need to see tangible room for Russian concessions; absent that, sentiment is likely to swing back and forth.”

For crypto markets, “a scenario in which geopolitical uncertainty merely ‘cools but does not thaw’ would leave bitcoin oscillating between its safe-haven narrative and its role as a high-beta risk asset,” they conclude.

BTC is No Longer in State of Euphoria

Linh Tran, Senior Market Analyst at, commented that Bitcoin’s short-term outlook is centred on interest rates, liquidity, and institutional capital flows.

“After the sharp volatility seen toward the end of 2025, BTC is no longer trading in a state of euphoria, but instead reflects the cautious sentiment of global investors amid persistently high rates and financial conditions that have yet to meaningfully ease,” Tran writes.

One of the most important factors influencing BTC is the level of U.S. Treasury yields. “BTC struggles to attract sustained new inflows unless markets begin to believe that the monetary policy cycle is approaching a turning point.”

Meanwhile, the USwill likely hold a cautious stance at the late-January meeting. Therefore, “only sufficiently strong economic data capable of shifting expectations around the rate path are likely to generate meaningful volatility in BTC; otherwise, the market is likely to remain locked in a tug-of-war,” the analysts argue.

Still, the most decisive factor for BTC’s near-term outlook are institutional flows, they conclude. “Bitcoin only establishes a durable uptrend when ETF flows remain consistently positive, rather than through sporadic inflows that are quickly reversed.”

Moreover, the dip-buying demand has not been strong enough to push prices through key resistance levels. Therefore, “without the support of fresh inflows, each rebound risks turning into a profit-taking opportunity, leaving the short-term trend choppy and lacking clear direction.”

“From my perspective,” Tan writes, “the most plausible near-term scenario is for Bitcoin to continue consolidating in a cautious manner, with downside risks persisting if ETF outflows continue. For a more constructive scenario to emerge, the market would need to see improvement on two fronts simultaneously: easing financial conditions and a steady return of institutional net buying.”

Conversely, Tan says, “if yields rebound or global markets shift decisively into a defensive, risk-off stance, Bitcoin is likely to face renewed downside pressure in the short term, given its high sensitivity to changes in risk appetite.”

Levels & Events to Watch Next

At the time of writing on Friday morning, BTC was changing hands at $89,477. It was quite a choppy trading day for the coin. The coin initially and briefly climbed to the intraday high of $90,159 and then dropped to the day’s low of $88,557. It continued trading in this range.

Over the past 7 days, BTC decreased by nearly 7%, trading in the $87,653–$95,649 range.

We now found the support at $89,300, followed by the $87,400 level. The latter previously acted as demand. On the other hand, the resistance levels stand at $91,800 and $94,200.

At the same time, ethereum was trading at $2,945. It saw a similarly choppy trading day. Earlier in the day, it fell from $3,012 to the intraday low of $2,909. For most of the day, it traded in the $2,944-$2,953 range.

Moreover, ETH fell 11.3% over the past seven days, moving between $2,898 and $3,361.

Should the downward push continue, the price may fall further below $2,900, followed by $2,830 and $2,745. If the tide turns, ETH may reclaim the $3,000 level, and if it manages to hold it firmly, the MOVE could open doors for additional notable increases.

Meanwhile, the crypto market sentiment remained unchanged over the past day, firmly maintaining its position within the fear zone.

The crypto fear and greed index currently stands at 34 today, the same level as yesterday.

This highlights the overall uncertainty and caution in the market, with participants waiting to see in which direction the needle will move.

ETFs See the Highest Drop in Two Months

The US BTC spot exchange-traded funds (ETFs) posted minor outflows on 22 January, totalling $32.11 million. This is the lowest amount of flows in nearly a month. The total net inflow now stands at $56.6 billion.

Of the twelve ETFs, only two recorded outflows, and none saw inflows.

let go of $22.35 million, andfollowed with $9.76 million in outflows.

Additionally, the US ETH ETFs posted minor negative flows as well, with $41.98 million. Like their BTC counterparts, this is also the lowest amount since late December. With this, the total net inflow pulled back further for a third day in a row to $12.34 billion.

Of the nine funds, two ETH ETFs posted outflows, and two saw inflows.took in 17.63 million in total.

At the same time,recorded $44.44 million in outflows, followed by$15.16 million.

Meanwhile, major French hardware wallet manufactureris reportedly planning a US initial public offering (IPO) that could value the company over $4 billion.

It WOULD do so in collaboration with Wall Street banks,, and.

Exclusive: The French cryptocurrency group, which sells devices that allow investors to securely store tokens, is working with bankers at Goldman Sachs, Jefferies and Barclays on an initial public offering that could take place as soon as this year. https://t.co/SLDJma0xX1 pic.twitter.com/FdoOGh6B58

Quick FAQ

After a single day of increases, the crypto market reverted to downward action that governed this week. Meanwhile, the US stock market closed the Thursday session higher for the second consecutive day. By the closing time on 22 January, thewas up 0.55%, theincreased by 0.76%, and therose by 0.63%. Presumably, the TradFi markers are still digesting the US’s apparent decision not to use military force in Greenland or impose tariffs on eight NATO allies.

For now, we may continue to see further decreases in the crypto market, at least in the short term. Nonetheless, the price action is not closed for a renewed upward trajectory, though how stable it would be is still unclear.