Exclusive: Can the CLARITY Act Save Crypto After Its Worst Week of 2026?

Bitcoin is sitting at $61,885, Ethereum has shed 18% seven days andXRP is clinging to $1.12. By almost every surface metric, the first week of June looks like a crisis. Avinash Shekhar, Co-founder and CEO of Pi42, one of India’s largest crypto futures platforms, sees it differently.

“The first week of June was defined by one of the sharpest corrections the crypto market has witnessed this year,” Shekhar told us in an exclusive conversation, “but the underlying story was a momentum reset and capital rotation rather than a fundamental breakdown of the digital asset ecosystem.”

What Actually Happened This Week

Bitcoin retreated from the $72,000 range to the $61,000 zone over the course of the week, dragging the total crypto market cap down to $2.13 trillion, a 16% plus decline across most major assets. 

The scale of liquidations across the market, over a billion dollars wiped from leveraged positions in 48 hours at the peak, illustrated how quickly borrowed money unwinds when sentiment turns and liquidity tightens.

Shekhar attributed the selloff to a combination of geopolitical uncertainty, significant ETF outflows that stretched to 13 consecutive days of net redemptions, and a broader shift in investor appetite away from risk assets. None of those factors, in his reading, represent a structural break in the industry’s long-term trajectory.

The Capital Rotation Nobody Is Talking About

One of the more quietly significant developments of the week, according to Shekhar, was where the money went rather than simply noting that it left.

“A notable trend this week was the rotation of capital toward other assets in the crypto market other than major assets,” he said, pointing to continued institutional activity across tokenization, stablecoins, blockchain infrastructure and corporate treasury adoption as evidence that long-term money has not left the ecosystem. It has simply moved to different corners of it.d.

Crypto Is Now a Macro Asset Whether It Wants to Be or Not

Shekhar also flagged what he described as a growing and increasingly undeniable correlation between crypto and broader financial markets.

“Investor behavior is increasingly being influenced by macroeconomic developments, liquidity expectations, and geopolitical events,” he said, describing it as evidence of crypto’s evolution into a more globally integrated asset class rather than the isolated alternative market it once was.

The strong jobs report that surprised markets last Friday, the ongoing Middle East tensions and the Federal Reserve’s signalling ahead of its June 16 and 17 meeting all fed directly into the crypto selloff this week. Bitcoin’s 80% correlation with the S&P 500 is not an anomaly. It is the new normal.

What Comes Next: Four Things to Watch

Looking ahead, Shekhar identified four factors that will shape where the market goes from here.

The first is the U.S. CLARITY Act, now formally on the Senate Legislative Calendar after clearing the Senate Banking Committee in May with a bipartisan vote. Passage would establish clear legal boundaries for digital assets for the first time, removing the regulatory uncertainty that has kept significant institutional capital on the sidelines.

The second is Bitcoin ETF flow trends. After 13 consecutive days of outflows draining approximately $4.33 billion, a reversal to net inflows would be the clearest signal that institutional appetite has returned.

The third is ecosystem developments across leading networks, particularly Solana, which despite falling 21% this week continues to show strong developer and user activity at the protocol level.

The fourth is the Federal Reserve. Whatever Powell signals at the June meeting will set the macro tone for risk assets through the summer.

The Longer View

Shekhar closed with a perspective that runs against the panic visible in the Fear and Greed Index.

“While periods of volatility can test investor conviction, they also serve as a reset mechanism that allows markets to reassess and refocus on long-term fundamentals,” he said. “The key indicators to watch remain adoption, regulatory clarity, institutional engagement, and the continued expansion of real-world blockchain applications.”