Crypto Funds Lose $1.67B as Bitcoin Sees 2026’s Worst Outflow

Bitcoin Products Led the Weekly Outflows

Bitcoin products accounted for the largest share of the decline, with $1.438 billion in weekly outflows. The move exceeded both the previous week’s record and the January peak, making it the largest single-week Bitcoin product outflow of 2026.

Bitcoin’s year-to-date fund-flow position weakened sharply over the same period. Cumulative inflows fell from $3.9 billion two weeks earlier to $2.6 billion one week earlier, then dropped to $1.2 billion after the latest reporting week.

Ethereum products also saw withdrawals, with $257 million in outflows during the same week. The figures showed that selling pressure extended beyond Bitcoin and affected major crypto investment products more broadly.

Provider-level selling was led by iShares, which posted $1.148 billion in outflows for the week. Grayscale followed with $251 million in outflows, while Fidelity recorded $190 million in withdrawals.

21Shares AG was the only provider with meaningful inflows, adding $8 million during the week. iShares alone managed $65.9 billion of the $141.9 billion in total digital asset investment product assets under management, giving its flow direction significant weight in the aggregate figures.

Altcoin fund participation narrowed during the same period. The number of assets with inflows fell from 11 three weeks earlier to only five assets with inflows above $1 million, showing that investor demand did not broadly rotate into smaller crypto assets.

XRP attracted the strongest altcoin inflow, with $20.3 million entering related products. Hyperliquid followed with $10.8 million in inflows, while NEAR added $7.6 million after strong late-May price performance.

U.S.-based products drove nearly all of the global withdrawals, accounting for $1.63 billion of the weekly outflow. Germany recorded $25.7 million in outflows, Sweden saw $6.6 million in withdrawals, and Hong Kong posted $4.5 million in outflows.

The selling was framed against Iran-related risk-off sentiment, which outweighed the positive effect that progress on the U.S. CLARITY Act had briefly provided earlier in the month. The pressure intensified through a series of geopolitical and regulatory developments.

U.S. Central Command confirmed strikes against Iranian missile launch sites and naval vessels near the Strait of Hormuz on May 25 despite an active ceasefire. Iran condemned the action, and Polymarket odds of a U.S.-Iran peace deal fell to 37%.

About $200 million in leveraged crypto positions could have been wiped out during the May 25 session, with losses concentrated heavily among long traders. By May 27, a single large participant appeared to have exited $1.29 billion worth of BlackRock’s IBIT ETF through a dark pool trade designed to avoid immediate price impact.

The Fear and Greed index fell 9 points in one session to 25, putting market sentiment in the Extreme Fear zone. May 28 was described as the most damaging day of the stretch, as fresh U.S. strikes near Iran triggered nearly $1 billion in 24-hour leveraged liquidations, with long positions making up 93% of the wipeout.

Bitcoin broke below $73,000 for the first time in months during the May 28 session, tying the fund-flow withdrawals to broader spot-market stress. The decline came as leveraged traders faced heavy losses and institutional products recorded large redemptions.

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CLARITY Act Debate Added Regulatory Pressure

The week’s pressure also included renewed debate over the U.S. CLARITY Act. On May 29, JPMorgan CEO Jamie Dimon criticized the bill, warning that it could allow crypto firms to offer bank-like products without adequate protections and predicting the framework might “eventually blow up.”

U.S. Treasury Secretary Bessent pushed back the same day by urging Congress to advance crypto legislation and calling it “the most important thing” for digital assets. Prediction-market odds of CLARITY Act passage later rebounded to 57%, but the shift was not enough to reverse the week’s outflow momentum.

The final confirmed state showed global crypto investment products in a three-week outflow streak, Bitcoin products at their worst weekly withdrawal level of 2026, and U.S.-based products driving almost the entire redemption wave.