Bitcoin ETFs Suffer Worst Day Since June After Crypto Bill Fails

Bitcoin investment funds just had their roughest day in months — and the reason wasn't a hacker or a crash. It was a failed vote in Congress.

What happened? On Tuesday, U.S. spot Bitcoin ETFs lost a huge amount of money as investors pulled their cash out. An ETF (exchange-traded fund) is a product that lets everyday people invest in something like Bitcoin through a normal brokerage account — no crypto wallet needed. When money flows *out* of these funds, it usually signals investors are nervous.

Here's how much was withdrawn in a single day:

• Bitcoin ETFs: $450.4 million pulled out (biggest single-day loss since June 24)
• Fidelity's FBTC: $214.8 million withdrawn
• BlackRock's IBIT: $161.7 million withdrawn
• Ethereum ETFs: $142.3 million lost
• XRP funds: stayed flat
• Combined total across all three assets: nearly $593 million

Why did this happen? The U.S. Senate voted 49 to 50 against advancing the Clarity Act — a proposed law that would have created the first real rulebook for crypto in America. It needed 60 votes to move forward. The law would have decided which government agencies oversee crypto and made most crypto trading clearly legal.

Why does a law matter to prices? Big investors — like banks and pension funds — usually stay away from things that live in a legal "gray zone." Clear rules make them comfortable putting in large amounts of money. Without those rules, that big money stays on the sidelines, which can drag prices down.

Is the law dead? Maybe not entirely. Supporters call it a "setback" rather than a total defeat, and Congress has about 22 working days left to try again. Meanwhile, the Federal Reserve (America's central bank, which sets interest rates) was also expected to make a big decision the same day — possibly its first interest rate hike in three years — which may have added to the market jitters.

Bottom line: Crypto markets got spooked by politics. Until clearer rules arrive, expect more ups and downs.

This is an AI-generated summary. Read the original article at: https://decrypt.co/378382/bitcoin-etfs-clarity-act-vote