U.S. crypto exchange-traded funds bled roughly $1.65 billion in the first week of November, with spot Bitcoin vehicles accounting for $1.28 billion and Ether funds shedding $365.2 million, according to data compiled by Farside Investors. The retreat deepened Friday, when Bitcoin ETFs lost more than $411 million in a single session, and it has coincided with a sharp drop in the Crypto Fear and Greed Index to 32, a reading that signals fear.

The selling accelerated after Democrats swept both chambers of Congress in last week’s midterm elections, a result that investors are still digesting. Senator Elizabeth Warren, one of the industry’s most vocal skeptics, is expected to chair the Senate Banking Committee, and the odds that the Senate…