On-chain data shows that bitcoin spot exchange inventory, which had previously been stuck in consolidation, has finally begun to follow a new trajectory.
bitcoin spot exchange supply has seen a sharp drop recently
in a new <a target="_blank" href="https://x.com/woonomic/status/1876179718892052950″ target=”_blank”>mail On x, analyst Willy Woo discussed the trend in bitcoin spot exchange inventory. This metric tracks the total amount of cryptocurrency held in the wallets of all centralized spot exchanges.
This part of the exchange supply refers to the actual tokens of the asset that exist on the blockchain. The exchange offering that does not actually involve users owning btc, as is the case with derivative products, is known as “paper btc.”
When spot exchange inventory increases, it means that investors are depositing a net amount of coins into the wallets associated with these platforms. As one of the main reasons holders may transfer their btc to exchanges is for selling-related purposes, such a trend may have a bearish impact on the price of the asset.
On the other hand, the fall of the indicator implies that currency outflows are exceeding currency inflows. Investors often put their coins into self-custody when they plan to hold them long-term, so this type of trend can be bullish for the cryptocurrency.
Now, here is a chart showing the trend in bitcoin spot exchange inventory over the past few years:
<img src="https://technicalterrence.com/wp-content/uploads/2025/01/Bitcoin-exchange-offer-breaks-balance-whales-get-240000-BTC.jpeg" alt="bitcoin Spot Exchange Offer” />
As shown in the chart above, bitcoin spot exchange inventory saw a large drop at the time of the FTX crash in November 2022. This suggests that a large movement of coins off of these platforms occurred when the bear market of the asset reached its bottom.
Following this drop, the indicator began a consolidation phase that lasted throughout 2023 and most of 2024. The trend was finally broken in the final months of 2024, when the metric recorded a sharp drop.
These outflows came alongside bitcoin's exploration of new all-time highs, implying that investor accumulation could have played a role in the run. In total, 240,000 btc left exchange-related wallets during this crash.
Woo has noted that Microstrategy's purchases in this period amounted to around 192,000 btc, meaning that there are other whales present in the market taking significant amounts from exchanges.
So far, the downward trend in spot currency inventory has shown no signs of bottoming out as capital outflows have continued into 2025. If investors indeed maintain accumulation in the near future as well, then bitcoin could benefit from further bullish momentum.
btc Price
bitcoin has continued its recovery sharply over the past 24 hours as its price has once again surpassed the $101,700 mark.
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