Bitcoin Exchange Reserves Plunge to 2022 Lows Amid Rising Institutional Demand

Bitcoin reserves on cryptocurrency exchanges have plummeted to levels not seen since 2022, with only 2.5 million BTC remaining, signaling a potential supply crunch. This decline coincides with growing institutional demand, particularly from exchange-traded funds (ETFs). Data from CryptoQuant confirms this scarcity, even as Bitcoin maintains a price above $95,000 despite market volatility. On Feb. 10, U.S. spot Bitcoin ETFs experienced net negative outflows of $186 million, a reversal from the previous day's $171 million inflows. Despite this, analysts remain optimistic, citing "seller exhaustion" and projections for Bitcoin reaching $160,000 to over $180,000 in 2025. ETF buying is outpacing mining by a factor of 20, and 69% of Bitcoin's supply is held by individual investors. The limited supply, coupled with potential government-backed Bitcoin reserves being discussed in 20 U.S. states, could trigger a significant price rally.