Crypto Stocks Sink as Trading Volume Plunges 50% and Bitcoin Tumbles

$900 billion. That's how much crypto was traded globally in January 2026. Compare that to $1.7 trillion in the same month last year, and you're looking at a market that's lost more than half its trading appetite. The numbers don't lie – crypto's winter is getting colder.

Eight Days of Pain

Bitcoin's6% plunge below $84,000 on Thursday wasn't just another dip – it was the catalyst for crypto stocks' worst stretch in months. Coinbase (COIN), the sector's bellwether, is now down for eight straight sessions, its longest losing streak since September 2024. At $195, the stock has retreated to May 2025 levels.

The carnage wasn't limited to the crypto giant. Gemini (GEMI) dropped 8% Thursday alone, while Bullish (BLSH) and Circle (CRCL) are down 16% and 20% year-to-date respectively. For crypto exchanges, the math is brutal: fewer trades mean fewer fees, and fewer fees mean shrinking revenues.

"Bitcoin has been stuck around the $85,000 level, and you can feel the hesitation in the market," Eric He, Community Angel Officer at crypto exchange LBank, told CoinDesk. "With geopolitical tensions rising, investors are staying cautious, and that's showing up across assets, not just crypto."

The AI Escape Route

But not every crypto company is drowning in red ink. The survivors? Those who pivoted away from pure-play crypto mining toward AI infrastructure and high-performance computing.

Hut 8 (HUT), IREN (IREN), CleanSpark (CLSK), and Cipher Mining (CIFR) are all posting year-to-date gains despite Thursday's selloff. These companies recognized early that their energy and computing resources could serve the AI boom just as well as bitcoin mining – perhaps better.

Mike Novogratz'sGalaxy Digital (GLXY) exemplifies this strategy. The crypto merchant bank recently received approval from Texas grid operator ERCOT for data center expansion, positioning itself at the intersection of crypto expertise and AI infrastructure demand.

What This Means for Your Portfolio

The divergence between traditional crypto plays and AI-pivoted companies reveals something crucial about market evolution. Pure crypto exposure is becoming riskier as institutional enthusiasm wanes and regulatory uncertainty persists. Meanwhile, companies that can leverage their crypto-era infrastructure for AI applications are finding new revenue streams.

For investors, this creates both opportunity and risk. The 47% decline in trading volumes suggests we're far from a crypto recovery, but the outperformance of AI-focused miners hints at where smart money is flowing.

Analysts heading into February are watching for signs of volume recovery, easing geopolitical tensions, and broader macroeconomic signals that could shift sentiment back toward risk-on investing. But with bitcoin struggling to hold $85,000 and exchanges bleeding volume, the path forward looks increasingly uncertain.