TL;DR
- Regulatory Uncertainty: Digital asset products saw $952 million in outflows, driven by delays to the U.S. Clarity Act and heightened whale selling.
- Major Asset Impact: Ethereum products led withdrawals with $555 million, followed by Bitcoin at $460 million, reversing momentum after a recent $452 million ETF inflow.
- Selective Altcoin Strength: Despite market weakness, Solana and XRP investment products posted $48.5 million and $62.9 million in inflows.
Digital asset investment products saw their first weekly outflow in four weeks, with $952 million exiting the market as delays to the U.S. Clarity Act prolonged regulatory uncertainty. CoinShares noted that the setback, combined with continued selling by whale investors, has made it increasingly unlikely that global ETP inflows will surpass last year’s totals. Total assets under management now stand at $46.7 billion, down from $48.7 billion in 2024, underscoring the market’s fragile sentiment.
U.S. Outflows Dominate Market Shift
The downturn was overwhelmingly driven by the United States, which recorded $990 million in outflows, according to CoinShares’ latest report. These losses were only partially offset by $46.2 million in Canadian inflows and $15.6 million in German inflows, highlighting a stark regional divergence. Analysts attributed the shift to delays in passing the U.S. Clarity Act, a development that has extended uncertainty for institutional investors. The report emphasized that whale-driven selling added further pressure, accelerating the retreat from U.S. products.
Ethereum and Bitcoin Products Lead Withdrawals
Ethereum-based investment products experienced the largest impact, registering $555 million in outflows. CoinShares described this reaction as expected, given Ethereum’s significant exposure to potential regulatory outcomes tied to the Clarity Act. Bitcoin products also saw substantial withdrawals, totaling $460 million. The reversal comes shortly after U.S. Bitcoin ETFs posted a strong $452 million inflow last Wednesday, marking their third-largest daily gain since October, before momentum abruptly shifted.
Market Weakness Aligns With Holiday Slowdown
The negative flows unfolded against a backdrop of muted price action as traders approached the December holiday period. Bitcoin is trading near $90,000, according to CoinMarketCap, but has struggled to maintain levels above this threshold for the past month. The combination of stagnant prices and legislative uncertainty contributed to a cautious market environment, prompting investors to reduce exposure across major digital asset products.
Select Altcoins Attract Targeted Inflows
Despite the broader retreat, some altcoins continued to draw investor interest. Solana investment products recorded $48.5 million in inflows, while XRP products attracted $62.9 million, signaling selective support for assets with distinct regulatory narratives. Even so, CoinShares warned that the latest weekly outflow makes it highly unlikely that global crypto ETPs will surpass last year’s inflow totals, reinforcing concerns about the sector’s near-term trajectory.
