Bitcoin reserves on exchanges hit a 5-year low

Crypto exchange platforms are seeing their Bitcoin reserves melt away like snow in the sun. In the space of a month, almost $6 billion worth of BTC has left the exchanges, taking reserves to their lowest level since November 2018.

Bitcoin leakage from exchanges reaches record levels

Bitcoin reserves on centralized exchange platforms have reached their lowest level in 5 years, according to data from CryptoQuant.

Over the past 30 days, exchange platforms have seen nearly 100,000 BTC, or the equivalent of $5.96 billion, disappear. This massive movement has total reserves to fall to 2.68 million BTC, a level not seen since November 2018.

This downward trend has accelerated since June 2022, coinciding with a series of turbulent events in the crypto market, including the collapse of Terra and the bankruptcy of FTX. Since the all-time peak in July 2021, when exchanges held more than 3.37 million BTC, there has been a steady decline of more than 20%.

The reasons behind this spectacular decline

Several factors explain this significant drop in reserves. Increased mistrust of centralized platforms (CEX) in the wake of recent scandals plays a major role. At the same time, the adoption of non-custodial storage solutions is increasing.

Note that this phenomenon is not limited to Bitcoin. Ethereum is experiencing a similar situation with a sharp drop in its reserves on exchange platforms, from 35.44 million ETH in June 2020 to just 16.8 million today.

The dramatic fall in Bitcoin reserves on exchanges reflects a growing distrust of centralized platforms. This trend heralds the emergence of a new paradigm in which investors prefer to be responsible for their own assets, thus favoring hardwares such as our partner’s D’Cent.