Bitcoin Exchange Reserves Hit New Low but Lose Their Bullish Punch

The amount of bitcoin and ether held on centralized exchanges has long been an important gauge of market supply and demand for institutional investors. Traditionally, declining exchange reserves indicated that investors were moving assets into cold wallets for long-term holding, reducing the available supply and providing a strong bullish signal. CoinDesk reported in July 2026, however, that changes in market structure have made the metric less reliable in predicting short-term price moves.

Bitcoin held on exchanges fell to 6.6% of its circulating supply, the lowest level since 2017, while ether’s share dropped to 4.3%, its lowest since 2015, according to data released by Santiment on July 9, 2026. Analysts including GoMining CEO Mark Zalan said the migration of substantial capital into spot ETFs, DeFi and institutional custody has significantly reduced the indicator’s reliability as a price predictor, weakening its former bullish implications.