In a significant turn of events, crypto investment products witnessed an outflow of $952 million, marking the first negative week in four, as delays surrounding a pivotal U.S. regulatory bill dampened investor sentiment.
Exchange-traded products (ETPs) were heavily impacted, with outflows primarily driven by Ethereum (ETH) funds, which accounted for $555 million, while Bitcoin (BTC) funds saw $460 million in withdrawals. These substantial outflows are largely attributed to the postponements related to the Digital Asset Market Clarity Act, commonly referred to as the Clarity Act. This situation has increased “regulatory uncertainty and concerns over whale selling,” according to a report by CoinShares released on Monday.
As a result of these outflows, it appears increasingly improbable that ETPs will surpass the inflows recorded last year, with current total assets under management sitting at $46.7 billion compared to $48.7 billion in 2024.
The majority of the outflows, approximately $990 million, originated from the U.S., slightly counterbalanced by $46 million in inflows from Canadian investors and $15.6 million from Germany.
On Thursday, David Sacks, the White House”s AI and crypto czar, announced that the Senate markup for the long-anticipated Clarity Act is now expected to take place in January 2026, a shift from earlier predictions that anticipated its arrival at President Donald Trump”s desk by the end of 2025. “We are closer than ever to passing the landmark crypto market structure legislation that President Trump has called for. We look forward to finishing the job in January,” Sacks stated in a post on X.
James Butterfill, head of research at CoinShares, noted that the decline in investor sentiment can be traced back to the delays associated with the Clarity Act. “Ethereum saw the largest outflows, totaling $555 million; this is understandable given it has the most to gain or lose from the Clarity Act,” Butterfill explained.
The Clarity Act aims to provide clarity on the definitions of crypto securities and commodities, delineating the jurisdictions of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission in relation to digital assets.
Despite the current regulatory uncertainty, some of the most successful traders, categorized as “smart money,” are still bullish on Ether, holding significant leveraged long positions amounting to $476 million. In contrast, they remain net short on Bitcoin with $109 million in short positions, as reported by Nansen, a blockchain intelligence platform.
