- Analysts believe this trend of low Bitcoin exchange supply aligns with bullish market conditions as more BTC moves into long-term storage or institutional custody.
- Bitcoin is consolidating near $87,500, with a key resistance level at $89,000. Analysts suggest a breakout above this level could pave the way for a rally toward $100,000 and beyond.
As the Bitcoin price consolidates around $87,500, the BTC supply on the exchange has sunk to a seven-year low, hinting at a major supply crunch that could drive the price higher. As per the blockchain analytics firm Santiment, Bitcoin’s ratio of supply to exchanges has dropped as low as 7.53%, which is the lowest since February 2018.
Why Bitcoin Exchange Supply Drop Is Bullish for BTC
Santiment further reported that this drop in the exchange supply hints at reduced short-term sell pressure. It also noted that BTC that move off exchanges often go to cold storage, which shows the investors’ intent to hold for the long term instead of liquidating immediately. Historically, such declines in exchange balances have aligned with bullish market conditions.
Furthermore, Santiment highlights that the shrinking exchange supply points to increasing interest from institutions and long-term custodial solutions. The movement of Bitcoin into self-custody or secure institutional storage indicates that market participants are increasingly treating Bitcoin as a store of value rather than a speculative trading asset.
Furthermore, corporate interest in Bitcoin has been picking up once again as video game maker GameStop revealed its latest plans to add $1.6 billion worth of BTC to its balance sheet, as mentioned in our last new piece.
Currently, it’s a tough fight between the Bitcoin bulls and bears, with analysts expecting an immediate breakout above $100K levels. As highlighted in our previous story, BTC is facing a major rejection at $89,000 levels. and a breakout above this is crucial for any move on the upside.
Bitcoin ETFs Showing Strength Once Again
Bitcoin ETF inflows have surged once again, clocking its ninth consecutive day of winning streak, marking the first such consistent inflows in 2025 so far. Blockchain analytics platform CryptoQuant stated that the BTC ETFs are at a pivotal moment as macroeconomic uncertainty prompts institutions to reassess their strategies and reduce risk exposure.
Earlier this year in 2025, outflows from the spot Bitcoin ETFs surged all the way to $5 billion, which was 12% from the all-time high net flows. This significant drawdown has exerted downward pressure on Bitcoin’s price, signaling a shift from the previously minor outflows observed in ETFs.
Although inflows into BTC ETFs have resumed following weeks of outflows, the CryptoQuant data shows that the market still remains in a choppy state, with neither strong demand nor significant supply influencing the flows.
Bitcoin is currently trading at approximately $87,000, while the ETF realized price—the average cost basis for ETF holders—stands at $72,546. This indicates that ETF investors are, on average, holding unrealized profits of 17%.
