Firi Weekly: $6 Billion ETF Sell-Off

U.S. Crypto ETFs See Six-Week Sell-Off:
- U.S. Bitcoin ETFs saw six consecutive weeks of net outflows totaling $5.9 billion, while U.S. Ethereum ETFs experienced a similar streak with $912 million in net outflows. The selling suggests traditional investors reduced crypto exposure, likely adding downward pressure to Bitcoin and Ethereum prices during the recent period.
Binance Faces MiCA Licensing Uncertainty:
- Reuters reported that Binance could have its MiCA application rejected by Greece’s Hellenic Capital Market Commission, potentially affecting its ability to market crypto services across the EU and EEA from July 1, 2026. Binance disputed the report, saying its application had been reviewed and found compliant. However, this week, the company announced that it had withdrawn its MiCA application in Greece to pursue authorisation in another European country.
Morgan Stanley Advances Ethereum and Solana ETFs:
- Morgan Stanley amended its U.S. Ethereum and Solana ETF filings last week, suggesting the products are moving closer to launch. The planned ETFs would offer the lowest fees among comparable U.S. products and stake some underlying Ether and Solana, potentially giving investors exposure to staking rewards through regulated fund structures.
Ethereum Foundation Cuts Staff After Leadership Exits:
- The Ethereum Foundation said Tuesday it laid off 20% of its workforce, about 54 employees, after co-executive director Hsiao-Wei Wang resigned Thursday and Tomasz Stańczak left in February. The restructuring comes as former researchers launch Ethlabs, backed by Bitmine and Ethereum co-creator Joe Lubin, potentially increasing pressure for faster Ethereum development.

Last Week’s Big Three

Binance Will Not Obtain a MiCA License in Time: Reuters reported last week that Binance, the world’s largest crypto exchange, is likely to have its MiCA application rejected by Greece’s financial regulator, the Hellenic Capital Market Commission (HCMC). In practical terms, a MiCA license is essential for the effective offering and marketing of crypto-asset services to residents of the EU and EEA from July 1, 2026. The regulation is designed, among other things, to strengthen investor protection and foster more mature crypto markets.

Binance responded quickly in the media, saying its understanding was different. According to Binance, HCMC had already completed its review of the application and considered it compliant with MiCA requirements. Binance also said the application had been reviewed by the European Securities and Markets Authority (ESMA). At the time, the company said it had not received any formal indication from HCMC that the application would be rejected.

Then, this week, Binance announced that it had withdrawn its MiCA application with the Greek authorities in order to pursue authorization in another European country. However, any new license will not be granted before July 1, so the question now is how Binance will handle its existing European clients in the meantime while seeking a MiCA license elsewhere.

Morgan Stanley Moves Closer to U.S. Ethereum and Solana ETFs: Morgan Stanley, one of the largest investment banks in the U.S., is preparing to launch both Ethereum and Solana ETFs in the U.S. The original applications were filed in January, but the bank amended both filings last week, which suggests the products are moving closer to launch. Both ETFs would have the lowest fees among similar Ethereum and Solana ETFs in the U.S. They also plan to stake part of the underlying Ether and Solana, allowing investors to earn a potential reward on the assets held by the funds.

The likely launch of these ETFs follows Morgan Stanley’s first U.S. crypto ETF launch in April, when the firm introduced a U.S. Bitcoin ETF. Morgan Stanley’s Bitcoin ETF has attracted about $348.3 million in net inflows since launch, which is not especially strong. However, the fund has also operated during a period of broader crypto market decline.

The Ethereum Foundation Enters a New Phase: Hsiao-Wei Wang resigned as co-executive director of the Ethereum Foundation on Thursday last week. The Ethereum Foundation is a non-profit organization that supports much of the development and research behind Ethereum, the second-largest cryptocurrency. Following the resignation, board member Bastian Aue has taken on expanded responsibilities for daily operations.

Wang’s resignation follows the departure of fellow co-executive director Tomasz Stańczak in February, as well as the recent exit of several core researchers from the organization, which we covered in Firi Weekly for week 21.

Then, on Monday this week, it was announced that several of the researchers who had left the Ethereum Foundation had founded Ethlabs, an independent non-profit research and development organization focused on Ethereum. The organization is backed by Bitmine, the largest corporate holder of Ether, and Joe Lubin, one of Ethereum’s co-creators, among others.

Earlier this week, the Ethereum Foundation then announced that it had laid off 20% of its workforce, equivalent to approximately 54 employees, as part of a move toward a leaner organizational structure. Hopefully, this will give the Ethereum Foundation a stronger foundation for faster execution, which has been a recurring criticism in recent years. At the same time, Ethlabs could become another force driving Ethereum development forward. So, even though there has been considerable commotion within the Ethereum community recently, it appears that it is gradually finding its footing.

Behind the Charts

Chart 1: Weekly U.S. Bitcoin and Ethereum ETFs Net Flow

Last week, the U.S. Bitcoin ETFs recorded their sixth consecutive week of net outflows. Over the six-week period, total net outflows reached a substantial $5.9 billion. In practice, this means the ETFs sold nearly $6 billion worth of Bitcoin into the market, as investors redeemed more fund shares than they purchased.

The U.S. Ethereum ETFs also recorded their sixth consecutive week of net outflows last week, with cumulative net outflows totaling $912 million.

Because these funds are often held by more traditional investors, the data suggests that this investor group has been reducing its exposure to Bitcoin and Ethereum. Given the scale of the outflows, they almost certainly contributed to downward pressure on crypto prices during the period.

A Number to Remember

3.5% to 3.75%

Last week, the U.S. central bank, the Federal Reserve (Fed), kept the U.S. dollar interest rate unchanged at its previous range of 3.5% to 3.75%. The notable part was that this was the first interest-rate announcement under the new Fed Chair, Kevin Warsh. The central bank also sounded less positive on potential rate cuts and instead suggested that higher interest rates may become necessary.

Overall, that is negative for the crypto market. When interest rates are higher, lower-risk investments tend to become more attractive relative to crypto.

On Our Radar

On our radar for the week ahead:

Will the ETF Selling Continue? We are watching whether Bitcoin and Ethereum ETF selling continues. If it does, it may suggest that traditional investors still want to exit or reduce exposure to digital assets.
What Happens Next for Binance? This may not move markets significantly in the near term, but it still matters what happens with Binance in Europe over the medium to long term and how it handles its existing clients, as this could shift the balance of power in the crypto market over time.
Can Oil Keep Falling? Oil prices have fallen sharply since the U.S. and Iran reached something close to a deal about a week and a half ago to end the war in the Middle East and reopen the Strait of Hormuz. Lower oil prices are positive because they can help reduce inflation and, in turn, increase the chance of lower interest rates. We are therefore watching whether oil continues to decline.

Mads Eberhardt

Written 26/06/2026

Should not be considered financial advice. Crypto may involve high risk.