Investment products focused on digital assets faced their first capital outflow in a month last week. A total of $952 million left the funds.
The negative dynamics are due to delays in the passage of the American Clarity Act bill, which once again heightened uncertainty in the market. Additionally, the activity of large holders influenced the sentiments of institutional players.
Investor caution amid regulation in the U.S.
According to weekly data on digital fund flows, the main reason for the outflow was the cumulative effects of stalled legislative review and renewed concerns about additional pressure on the market from large holders (whale investors).
"We believe this reflects the market's negative reaction to the delays in the adoption of the Clarity Act in the U.S. This factor has prolonged the period of regulatory uncertainty for the asset class. The situation has been exacerbated by concerns about ongoing sell-offs by large investors," noted James Butterfill, head of research at CoinShares.
Currently, analysts note a decrease in momentum in the market. It is becoming increasingly unlikely that inflows into exchange-traded products (ETPs) for digital assets in 2025 will exceed last year's figures. The total assets under management now amount to $46.7 billion. In comparison, at the end of 2024, this figure was at $48.7 billion.
Geographic distribution of capital flows
The majority of negative sentiment originated from the United States. In this region alone, investors withdrew $990 million. At the same time, market participants from other countries demonstrated a more constructive approach.
In particular, Canada recorded an inflow of $46.2 million. Germany also attracted $15.6 million. However, these inflows were not enough to reverse the overall negative trend of the week.
Such a divergence indicates that regulatory uncertainty is primarily pressuring American institutional products. Products registered in other jurisdictions are significantly less affected by this factor.
Dynamics of leading assets
Ethereum led the outflow of funds last week, losing $555 million. This reflects the asset's heightened sensitivity to the outcome of legislative processes in the U.S. Market participants believe that Ethereum is the most dependent on clear definitions of what constitutes a digital commodity and what constitutes a security.
Despite the sharp weekly outflow, the long-term metrics of the second-largest cryptocurrency remain strong. Since the beginning of the year, inflows into Ethereum-based products have totaled $12.7 billion. This significantly exceeds the total for the entire year of 2024, which was $5.3 billion. This statistic indicates that long-term interest remains, but short-term investor confidence remains fragile.
Bitcoin also faced a capital outflow of $460 million. Although the first cryptocurrency continues to hold the largest share of institutional funds, the inflow since the beginning of the year totals $27.2 billion. This is significantly lower than the $41.6 billion recorded in 2024.
Current data indicates that Bitcoin's status as a 'safe haven' is being put to the test. Overall uncertainty in the U.S. market affects even the most established assets.
Notably, not all digital assets have been caught up in the wave of sell-offs. For example, Solana-based products recorded an inflow of $48.5 million. XRP also showed positive dynamics, attracting $62.9 million.
These figures signal selective support from investors rather than a total exit from the asset class. Capital is shifting towards instruments perceived as having clearer regulatory positioning or strong internal growth drivers.
Until American lawmakers provide clearer direction through initiatives such as the Clarity Act, the movement of funds in the markets is likely to remain volatile.
