XRP ETFs draw $5.66M as Clarity Act progress fuels rotation from HYPE

XRP spot ETFs recorded $5.66 million in daily net inflows on July 22 while Hyperliquid funds shed $698,040, SoSoValue data show.

"Today's draft is a meaningful step toward the Senate vote on the Clarity Act we've been calling for," Cody Carbone, CEO of the Digital Chamber, said. The 616-page bill, released by Senate Republicans on Wednesday, includes ethics rules barring the president and members of Congress from issuing or sponsoring digital assets, a provision that addresses months of Democratic pressure over President Donald Trump's crypto ventures, which a July financial disclosure tied to about $1.4 billion in 2025 income.

The divergence in fund flows reflects a broader rotation as the Clarity Act advances toward a Senate floor vote. Majority Leader John Thune plans to bring the bill to a vote in the coming weeks, though it needs 60 votes to pass, requiring support from at least seven Democrats. The legislation preserves the Blockchain Regulatory Certainty Act, which clarifies that non-custodial developers are not money transmitters, and adds bankruptcy protections treating customer digital assets as property of the customer rather than a failed company's estate. A separate stablecoin-yield compromise bans interest on idle payment-stablecoin balances while allowing rewards tied to transaction activity.

The capital shift toward XRP — a token with clearer regulatory standing after the SEC's July 2023 ruling that it is not a security — suggests institutional investors are positioning for a regulatory framework that could formally legalize most crypto activity in the US. The Clarity Act divides oversight between the SEC and the Commodity Futures Trading Commission, giving XRP and similar tokens a defined regulatory path that Hyperliquid's HYPE token, operating on a decentralized perpetual exchange, currently lacks.

The XRP ETF inflows come as the broader crypto fund complex has seen mixed flows this year. Bitcoin ETFs have drawn steady institutional interest, while Ethereum funds have lagged. XRP's outperformance in fund flows suggests investors view it as a direct beneficiary of the Clarity Act's market structure provisions, which would codify the SEC's classification of tokens without an associated security offering.

The ethics provisions, which sunset on Jan. 20, 2029, were negotiated between the White House and Republican Senators Cynthia Lummis and Bernie Moreno, though the bill currently lacks Democratic sign-off. Twelve Senate Democrats this week urged negotiators to limit the spread of prediction markets under the bill, citing concerns over tribal gaming rights under the Indian Gaming Regulatory Act.

The rotation out of Hyperliquid, a perpetual DEX on Ethereum, mirrors a pattern seen in prior regulatory milestones where capital flows toward assets with defined legal status. Treasury Secretary Scott Bessent described the effort as being at the "1-yard line," while Trump has pressed the Senate to act before the August recess. The House passed its version of the bill in July 2025 on a 294-134 vote, and Coinbase and other firms have pushed for Senate passage before lawmakers break for the midterm campaign season.

This article is for informational purposes only and does not constitute investment advice.