Why is Bitcoin's percentage supply on crypto exchanges near 7-year lows?
Bitcoin's supply on exchanges has fallen below 11%, the lowest since March 2018, with over 1.26 million BTC withdrawn since March 2020. HODLing among investors has reached a two-year high, indicated by a low Exchange Flows to Network Activity Ratio, suggesting long-term holders prefer cold storage over trading. Institutional custody solutions are increasingly favored by large financial entities like BlackRock and Fidelity, with Coinbase Prime reporting significant asset inflows while Coinbase exchange saw over $500 million in BTC outflows in Q1 2025. Spot Bitcoin ETFs have grown substantially, managing $44.54 billion as of June 5, 2025. Trust in exchanges has declined post-FTX collapse, leading to sustained outflows exceeding 200,000 BTC from centralized exchanges between November 2022 and May 2023.
