Capital Rotation, New Fed Chair, & Big Tech Earnings

View from the Arch #119

January 30, 2026

Hope everyone’s been staying warm!

This Week in Crypto

Another week of bad news, unfortunately -

  • Bitcoin fell from around $90K to as low as $81K last night before bouncing slightly to $82-$83K. This marks Bitcoin’s lowest level since mid-November.

  • Ethereum got hit even harder, dropping below $3,000 to around $2,740 - down over 7% for the week.

  • The broader altcoin market bled heavily, with Solana falling to $113, XRP dropping to $1.76, and most major tokens posting 5-7% losses. 

  • Liquidations were massive: over $1.75B in leveraged long positions were liquidated in 24 hours, with $777M liquidated in just one hour Thursday night.

ETF flows were also negative -

  • U.S. spot Bitcoin ETFs posted their worst week of 2026, bleeding $1.137B over five consecutive days. The outflows were highly concentrated in three major products - Grayscale dumped $160M, Fidelity shed $151M, and BlackRock lost $57M on January 20 alone.

A couple reasons behind the carnage -

  • Capital rotation into precious metals: Gold hit record highs above $5,600/oz Thursday before pulling back to $5,200, while silver surged.

  • Fed rates holding steady: The Fed kept interest rates at 3.50%-3.75% on Wednesday as expected, with signals that rate cuts won’t happen until later in 2026.

  • New Fed Chair: Trump nominated Kevin Warsh as the next Fed chair, which spooked traders who had hoped for the more dovish Rick Rieder.

This Week in TradFi

The Fed held steady this week -

  • The Federal Reserve kept interest rates at 3.50%-3.75% on Wednesday as widely expected, but the decision wasn’t unanimous. Two FOMC officials dissented and voted for a 25bp cut.

  • Chair Jerome Powell struck an optimistic tone about the economy, noting it "expanded at a solid pace last year and is coming into 2026 on a firm footing."

  • Markets expect only one rate cut in 2026, likely in June - after Powell’s term expires in May.

Trump nominated Kevin Warsh for Fed Chair -

  • This morning Trump nominated Kevin Warsh to succeed Powell. 

  • Warsh served on the Fed board during the 2008 financial crisis and is known as an inflation hawk.

  • Warsh has been highly critical of the Fed, calling for "regime change," arguing the Fed needs to rethink its economic models and shrink its staff.

And Big Tech earnings saw mixed results - 

  • Meta crushed it: Stock surged 9% after beating across the board.

  • Microsoft disappointed: Stock fell 7%, later stabilizing around -11%, after cloud growth slowed and spending rose. The company beat earnings expectations but guidance concerned investors about whether AI investments are paying off.

  • Tesla rallied 2%: Tesla announced it removed safety drivers on a limited basis for its Austin robotaxi service, though automotive deliveries fell 8.6% in 2025.

  • Apple fell 1.2% despite beating: Apple reported strong quarterly results and higher iPhone sales but the stock couldn’t hold gains - a familiar pattern where Apple drops even after good earnings. 

Gold hit record highs - 

  • Gold had an absolutely insane week, soaring above $5,600/oz on Thursday, its first time ever above $5,000 - before reversing and dropping back to $5,200 in minutes during U.S. morning trading. 

  • The wild ride reflects extreme safe-haven demand amid geopolitical uncertainty and concerns about U.S. credibility. 

This Week in Tech

Microsoft’s earnings exposed the pretty brutal cost of AI infrastructure:

  • Microsoft beat earnings expectations, but the stock still fell hard as executives highlighted accelerating capex tied to AI hardware and data center expansion, alongside slight Azure deceleration. 

  • This has reignited a debate that’s been brewing for a bit - how long will markets tolerate “spend now, monetize later”? 

  • Microsoft’s capex is expected to hit $99B this fiscal year and keep climbing, with analysts projecting similar massive increases at Meta. 

  • The stock selloff took $400 billion off Microsoft's market cap and dragged down the entire enterprise software sector.

As usual, below are some fundraising announcements, M&A, and tech personnel changes that caught our eye:

Arch is building a next-gen wealth management platform for individuals holding Alternative Assets. Our flagship product is the crypto-backed loan, which allows you to securely and affordably borrow against your crypto.

Disclaimer: None of the above is financial advice, seriously.