ETFs and corporate funds are siphoning off millions of BTC from exchanges

Analysts say that Bitcoin is increasingly located within ETFs and corporate funds.

Bitcoin reserves held in centralized exchanges have fallen to their lowest level in 2019. Data shared by crypto market analyst Dark Fost shows that exchange reserves will steadily decrease from 2022.

This trend accelerated after the collapse of the FTX exchange.

Bitcoin supply migration

In November 2022 alone, more than 325,000 BTC were removed from the exchange’s reserves as investors moved their assets from centralized platforms. As a result of this continued withdrawal, the total BTC reserves on exchanges available to retail investors are now down to around 2.7 million BTC.

Among these platforms, Binance alone accounts for about 20% of the remaining reserves. When the platforms mainly used by professional investors are included in the analysis, Coinbase Advanced is in the first place with about 800,000 BTC. However, this number is still about 200,000 BTC below the level recorded in July 2025.

Dark Fost stated that while the collapse of FTX played an important role in encouraging investors to keep assets in private wallets, two additional developments also contributed to the reduction of the exchange’s balance sheet. The first is the launch of Bitcoin spot exchange funds in January 2024. At the time of their introduction, the exchange reserves were still above 3.2 million BTC. Since then, ETFs have amassed about 1.3 million BTC, roughly 6.7% of the total Bitcoin supply, effectively removing that amount from the exchange’s liquidity.

The second factor is the rise of digital asset custodians (DATs) that hold Bitcoin as a reserve asset. Collectively, these companies now control about 1.1 million BTC, or about 5% of the total supply. Both ETF holdings and corporate funds represent a growing share of Bitcoin supply in structured finance vehicles.

“In the long run, these changes can play a significant role in market liquidity and price formation, even if these structural effects will always take time to fully materialize.”

Geopolitical tensions are blocking the approach

Amid the changing supply pattern, Bitcoin entered the second week of March under pressure as markets focused on rising tensions in the Middle East. The cryptocurrency recently failed to break above $70,000 as the ongoing US-Iran conflict contributed to broader market uncertainty. Despite the pullback, crypto trader and analyst Michael van de Poppe said BTC’s current price action does not represent a worst-case scenario.

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In his latest message on X, the trader noted that Bitcoin continues to trade within a range, but described the indicator as relatively strong given the current market conditions. Oil prices rose nearly 15% on Monday to their highest level since 2022, he said, while gold and commodities fell and the Nasdaq fell sharply. Van de Poppe added that if the US stock market rises and oil prices begin to correct, Bitcoin could accelerate back to $70,000.