Bitcoin exchange reserves plunge to 2.5M amid ETF surge

Bitcoin (CRYPTO:BTC) reserves held across cryptocurrency exchanges have plummeted to 2.5 million BTC, marking the lowest level in nearly three years, according to data from CryptoQuant.

This decline coincides with surging demand for Bitcoin exchange-traded funds (ETFs) and may signal a potential supply shock.

The diminishing Bitcoin supply on exchanges could trigger an incoming price rally, driven by strong buyer demand meeting decreasing available BTC, leading to price appreciation.

Despite concerns over global trade wars sparked by new import tariffs from the U.S. and China, BTC rose by 0.4% to trade above $97,000.

Bitcoin has shown resilience above the $95,000 support level, despite experiencing the largest daily selling pressure since the collapse of Three Arrows Capital in June 2022.

According to Ryan Lee, chief analyst at Bitget Research, this resilience suggests "strong institutional interest" and "seller exhaustion."

“The phenomenon of ‘seller exhaustion’ might further indicate that the market is transitioning from selling to buying pressure,” he added.

However, stagnating spot Bitcoin ETF inflows may continue to pressure Bitcoin’s price trajectory.

On Feb. 10, U.S. Spot Bitcoin ETFs saw over $186 million worth of net negative outflows, erasing the previous day’s net positive inflows of $171 million, according to Farside Investors data.

Maintaining the $95,000 support level is critical for Bitcoin’s momentum to avoid significant downside volatility.

A potential Bitcoin correction below $95,000 would liquidate over $1.52 billion worth of cumulative leveraged long positions across all exchanges, CoinGlass data indicates.

Despite short-term correction concerns below $90,000, Bitcoin’s price trajectory remains optimistic for the rest of 2025, with predictions ranging from $180,000 to above $200,000.

Analysts from Bitwise, Standard Chartered, and VanEck anticipate Bitcoin rising to these levels in 2025. 

At the time of reporting, the Bitcoin (BTC) price was $95,657.71.