Bitcoin exchange reserves have fallen below 15%, suggesting a supply shock as institutional demand from exchange-traded funds (ETFs) grows . According to Glassnode data, the percentage of BTC on exchanges has dropped to a seven-year low, reaching 14.5% for the first time since August 2018 .
Diminishing Bitcoin supply on exchanges may signal an incoming price rally fueled by a “supply shock,” which occurs when strong buyer demand meets decreasing available BTC . This trend usually signals rising investor confidence and a shift toward long-term holding . For example, BTC is typically transferred to cold storage or self-custody wallets, reducing the liquid supply available for trading . Whales often withdraw BTC after buying, signalling ongoing accumulation . With fewer coins available for sale, short-term sell pressure diminishes .
Over-the-counter (OTC) Bitcoin balances also hit all-time lows . These desks typically match buyers and sellers but depend on maintaining BTC reserves for swift and reliable trade execution . The cumulative balance of BTC held in known OTC addresses is at historic lows . CryptoQuant data shows a 21% decline in OTC address balances linked to miners since January, now down to an all-time low of 155,472 BTC .
Bitcoin's percent supply on exchanges has dropped below 11% for the first time since 2018 . Institutional adoption is accelerating BTC withdrawals from public exchanges . Trust in centralized platforms is shaky post-FTX .
ETFs have attracted a large portion of the Bitcoin to their coffers . The net worth of assets managed across spot Bitcoin ETFs was $44.54 billion as of June 5, up from around $1 billion at their launch in January last year . Supporting this trend, a 2025 survey by Coinbase and EY-Parthenon found that 83% of institutional investors plan to increase their crypto exposure, with nearly 60% allocating over 5% of their AUM to digital assets . About 61 public companies already control over 3% of the total Bitcoin supply of 21 million tokens, according to Standard Chartered .