Exchanges are losing BTC as investors move to self-custody. Here’s how it changes the market and affects Bitcoin’s price.
As of October 2025, BTC balances on exchanges continue to decline. According to CryptoQuant, reserves are around 2.5 million BTC, which is almost 14 percent less than at the start of the year. The Glassnode platform confirms that the share of coins currently held on centralized venues has fallen to 14.5 percent of total supply, reaching the lowest level since 2018.
This shows that the amount of Bitcoin held off-exchange is growing, and more market participants are choosing to store Bitcoin independently. Bitcoin self-custody is becoming one of the year’s main trends.
In this article you will learn:
A few years ago, most holders considered exchanges a reliable place to store coins. Now users increasingly prefer to control their assets themselves and avoid dependence on intermediaries.
This shift shows the market is becoming more mature, and investors understand the importance of controlling their keys. It reflects a transition from centralized venues to independent and secure capital management.
In 2020, the total BTC reserves on exchanges exceeded 3.2 million coins. Since then, volumes have been steadily shrinking, and according to Glassnode and CryptoQuant, the balance on exchanges metric shows a persistent decline without notable pullbacks. Sometimes price increases trigger brief inflows of funds, but the overall direction remains downward.
Source: CryptoQuant, data on BTC reserves on exchanges.
In one of its latest reports, CryptoQuant recorded monthly Bitcoin outflows from exchanges of over 90,000 BTC from major venues including Binance, Coinbase, and Bitfinex. Daily inflows to exchanges have fallen to 18,000 BTC per day, close to a decade low. Analysts link this to more investors moving assets into Bitcoin cold storage and using self-custody to protect funds.
This behavior is a consequence of recent years’ experience. After the FTX collapse in 2022, trust in centralized exchanges fell sharply. Many users realized the risk of keeping BTC on an exchange and began looking for safer solutions.
More and more investors are learning how to withdraw BTC from an exchange and move it to cold storage to avoid dependence on intermediaries’ infrastructure.
At the same time, storage technologies are becoming more accessible. Hardware wallets such as Ledger, Trezor, and SafePal have become common tools. Multichain solutions and DeFi protocols allow direct asset management without third-party services.
The phrase “Not your keys — not your coins” is no longer perceived as a slogan — it has become a standard principle shaping users’ approach to security and storage.
Therefore, the decline of BTC on CEX is perceived as a deliberate step toward safety. More market participants believe that exchange storage suits only active trading, while long-term investments should be moved to self-custody.
When BTC reserves on exchanges decrease, so does the volume of coins available for quick sale. This reduces selling pressure and helps stabilize the price.
According to Glassnode, Bitcoin outflows from exchanges are viewed as a positive signal, as coins move into long-term storage and temporarily leave circulation.
However, there is another side to this trend. As reserves shrink, market depth decreases, so even small trades can affect price. Volatility rises under low liquidity, and demand immediately reflects in the rate.
As a result, the influence of low BTC reserves becomes more noticeable, and Bitcoin liquidity in 2025 takes on special importance for market participants.
For traders, instant trading remains possible only for those who keep part of their capital on CEX. Other investors prefer Bitcoin in cold storage to secure their assets.
Falling reserves and the analysis of BTC balances on exchanges show that the market structure is changing. Centralized exchanges no longer serve as a place to store assets and are gradually turning into convenient on-/off-ramps between fiat money and digital assets.
Users increasingly work directly with DEX, DeFi, and self-custody wallets.
Against this backdrop, the key trends of 2025 are taking shape:
These trends make the market more mature and resilient. Capital is steadily moving into DeFi and self-custody, and Bitcoin liquidity in 2025 is becoming a key factor of stability.
The reduction of BTC reserves to 2.5 million coins and their share to 14.5% of total supply reflects profound market changes. The crypto market is moving away from centralized intermediaries toward a model where users manage their assets themselves.
This reduces selling pressure and increases price resilience. At the same time, low BTC balances on exchanges make the market more sensitive to large trades and amplify volatility.
For traders and investors, this signals that the era of simply storing on exchanges is ending. Security management becomes an integral part of strategy. With further Bitcoin outflows from exchanges, analysts expect potential BTC price growth if demand remains stable.
Outflow means users are withdrawing their BTC from trading venues to personal wallets. This indicates growing trust in self-custody and reduced dependence on intermediaries. The more coins move into self-custody, the smaller the volume of assets available for instant sale on the market.
When there is less Bitcoin on exchanges, spot market supply contracts. Glassnode analysts view BTC outflows as a bullish signal because coins move from circulation into long-term storage. With stable or rising demand, this creates conditions for gradual price appreciation.
Fewer coins on exchanges mean shallower order books. This increases volatility: even small trades can noticeably move the price. In such conditions, liquidity becomes “premium” and is available only to those who keep part of their assets on CEX.
It is safer to hold Bitcoin in a non-custodial or cold wallet where the owner controls the private keys. On centralized exchanges, assets depend on the company’s infrastructure and can be frozen or lost in case of failures. Self-custody gives the user full control over funds.
This phrase underscores a core principle of blockchain: if you don’t have the private keys, you don’t own your coins. Controlling the keys means direct ownership of the asset and protection from external risks associated with intermediaries.
Yes, partially. The fewer BTC remain on centralized platforms, the lower the market supply and the higher the upside potential when demand increases. However, price is also influenced by macroeconomic factors, institutional flows, and overall investor sentiment.
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