U.S. spot bitcoin ETFs saw $450.4 million flow out in a single day, the biggest net outflow since June 24, blockchain media outlet Decrypt reported on Tuesday.

On the same day, ethereum ETFs posted a $142.3 million net outflow and XRP funds were flat. The outflows coincided with the U.S. Senate failing to process the Clarity bill, a digital asset market structure measure. In a cloture vote to move the bill into formal debate, the Senate recorded 49 votes in favour and 50 against. The procedure required 60 votes, so the bill made no progress and the chances of passage in 2026 also fell sharply.

The outflows spread across major asset managers. Fidelity's FBTC recorded the biggest outflow at $214.8 million. BlackRock's IBIT posted a $161.7 million net outflow and Grayscale's GBTC saw $44.1 million flow out. Ark 21Shares and Bitwise products also saw comparatively smaller outflows.

Weakness in ethereum ETFs also continued. Ethereum ETFs saw $142.3 million flow out on the same day. By contrast, XRP funds drew in $11.3 million the previous day, but saw flows essentially stop on the day. Combined net outflows across the three asset classes totalled about $593.0 million, the steepest single-day pullback in the crypto ETF market since June.

The direct backdrop to the market shock was legislative failure, not hacking or a sharp drop. Senator Elizabeth Warren opposed the bill on the Senate floor, saying it could bring about an "economic collapse triggered by crypto." Senator Cynthia Lummis, who led negotiations on the bill, said "it's over" just before the vote, effectively acknowledging the possibility the bill would be derailed. After the vote was confirmed, she sharply criticised Democrats.

The Clarity bill centred on giving the U.S. crypto market comprehensive rules for the first time. It was designed to split supervisory authority between the Securities and Exchange Commission and the Commodity Futures Trading Commission and to organise the legal framework for most crypto trading in the United States. With the bill failing, efforts to secure regulatory clarity for institutional investors to treat bitcoin like a conventional financial product have also been delayed again.

Still, legislative discussions are not completely over. Industry group the Digital Chamber characterised the outcome as not a defeat but a "setback." With about 22 working days left before the Senate moves fully into the midterm election phase, a last-minute push remains possible.

If the bill is not revived, the U.S. crypto market is likely to rely more for the time being on rule-making processes by regulators. Treasury Secretary Scott Bessent has already cited SEC and CFTC rule-making as an alternative path. As a result, for the remainder of 2026, the regulatory landscape for the U.S. crypto market is expected to be shaped more by regulators' moves than by congressional legislation.