Bitcoin exchange reserves have fallen to their lowest level since 2022, suggesting a potential supply shock as institutional demand from exchange-traded funds (ETFs) continues to grow.

Bitcoin (BTC) reserves across all cryptocurrency exchanges have fallen to an over three-year low of 2.5 million BTC, CryptoQuant data shows.

Diminishing Bitcoin supply on exchanges may signal an incoming price rally driven by a “supply shock,” which occurs when strong buyer demand meets a decreasing amount of BTC, leading to more price appreciation.

Meanwhile, BTC had risen by 0.4% in the 24 hours leading up to the time of writing to trade above $97,000 despite investor sentiment pressured by global trade war concerns following new import tariffs announced by the US and China.

Related: Kentucky joins growing list of US states to introduce Bitcoin reserve bill

Bitcoin resilient above $95,000 on “strong institutional interest”

Bitcoin remained above the key $95,000 psychological support despite experiencing the largest daily selling pressure since the collapse of Three Arrows Capital (3AC) in June 2022.

Bitcoin’s resilience above the $95,000 mark suggests “strong institutional interest” and “seller exhaustion,” according to Ryan Lee, chief analyst at Bitget Research:

“The phenomenon of ‘seller exhaustion’ might further indicate that the market is transitioning from selling to buying pressure.”

“Factors like global economic conditions, technological advancements, and psychological support levels also play crucial roles in stabilizing Bitcoin’s price,” he added.

However, stagnating spot Bitcoin ETF inflows may continue to pressure Bitcoin’s price trajectory.

US Spot Bitcoin ETFs saw over $186 million worth of net negative outflows on Feb. 10, erasing the previous day’s net positive inflows of $171 million, Farside Investors data shows.

Related: Austin University to launch $5M Bitcoin fund with 5-year HODL strategy: Report

Maintaining the $95,000 psychological support will be critical for Bitcoin’s momentum to avoid significant downside volatility.

A potential Bitcoin correction below $95,000 would liquidate over $1.52 billion worth of cumulative leveraged long positions across all exchanges, CoinGlass data shows.

Despite short-term correction concerns below $90,000, Bitcoin’s price trajectory remains optimistic for the rest of 2025, with predictions ranging from $160,000 to above $180,000.

Magazine: BTC above $150K is ‘speculative fever,’ SAB 121 canceled, and more: Hodlers Digest, Jan. 19 – 25