Ethereum [ETH] is in the spotlight, but not for good reasons. After weeks of inflows, $555 million exited ETH-linked products last week. What’s more? Despite exchange balances being at their lowest since 2016, Ethereum continues to underperform Bitcoin [BTC].

The much-anticipated Ethereum-led altseason of 2026 looks unlikely for now.

The line of fire

Ethereum bore the brunt of last week’s risk-off move, leading digital asset fund outflows with a mammoth $555 million exit. This is the largest among major tokens.

According to CoinShares data, this was the first weekly withdrawal in a month. The report cites delays to the U.S. Clarity Act at a critical moment for ETH as a possible reason.

Source: CoinShares

The reaction was heavily U.S.-centric, with nearly all outflows originating from American investors; it seems like Ethereum’s outlook is hugely tied to regulations.

While Bitcoin saw withdrawals too, ETH’s positioning made it vulnerable. As the asset with the most to gain (or lose) from clearer rules, ETH became the market’s pressure point.

With that being said, total year-to-date inflows remain well above last year’s levels.

Read between the lines