Three converging pressures are weighing on crypto prices: a deteriorating Iran situation, hawkish FOMC rhetoric, and declining legislative odds for the CLARITY Act. Despite this, digital assets have demonstrated notable resilience relative to other asset classes, according to CoinShares’ Research Department.
Flows: a divergent picture
Digital asset ETPs recorded US$605M of outflows this week, breaking four consecutive weeks of inflows. Yet beneath the headline, a more constructive signal is emerging: Bitcoin and blockchain equity products attracted US$624M over the past four weeks — double any historical inflow run over the same window. Institutional capital is not retreating; it is rotating.
Blockchain equity inflows reached US$615M month-to-date, a monthly record, with US$289M arriving this week alone. Listed miners pivoting toward AI infrastructure, and the structural exposure they offer to rising stablecoin usage, are attracting allocators who remain restricted from direct digital asset exposure.
FOMC: hawkish hold with implications
The Fed held rates steady but the decision carried a distinctly hawkish flavour. Four dissents were recorded — three favouring a hawkish bias, with Stephen Miran the lone advocate for a cut. Powell signalled that non-voters also lean against an easing bias, suggesting more restrictive commentary is likely in coming weeks. The June meeting remains wide open. Markets are pricing near-zero probability of a cut at that meeting.
CLARITY Act: a narrowing window
The CLARITY Act cleared the House 294-134 in July 2025 but has been stalled in the Senate since. Senator Tillis has now requested markup for the week of 11 May. Polymarket odds currently sit at 46%. The binding constraint is the legislative calendar: Memorial Day recess begins 21 May, and August is lost to recess and campaign season, leaving roughly a dozen working weeks before November.
The asymmetry is important for portfolio construction. If the Act passes, Ethereum and broader altcoins are the primary beneficiaries — statutory commodity classification would remove SEC overhang on staking, DeFi, and institutional treasury allocation. Bitcoin’s regulatory status is already de facto settled, limiting marginal gain. If it fails or slips to 2027, expect 15-25% altcoin drawdowns versus Bitcoin, with institutional capital remaining sidelined.
Gold is being pressured by expectations for higher real interest rates. Bitcoin has weakened but continues to outperform. Since the 28 Feb escalation, Bitcoin has returned close to 23%, while equities are down 3.3% and gold has declined nearly 9%. Whale activity has turned negative in recent weeks, a note of caution, but the underlying flow dynamic — structural equity exposure accelerating while pure-play crypto is trimmed on macro caution — reads as a healthy signal beneath the headline weakness.
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