Bitcoin recently surged past $125,700 on Coinbase, setting a fresh peak in the crypto market.
That top outpaces the prior all-time high of about $124,500, reached in mid-August.
While prices dipped by 13.5 % into September, the asset has rallied sharply in recent days.
Exchange Balances Plunge
As Bitcoin’s price climbed, holdings on centralized exchanges dropped dramatically.
Glassnode data shows that the total balance on exchanges fell to 2.83 million BTC, a level not seen since early 2019.
CryptoQuant, another analytics provider, records an even lower figure: 2.45 million BTC, marking a seven-year low in its data.
Over the past two weeks alone, more than 114,000 BTC (worth over $14 billion) have exited exchanges, per Glassnode figures.
When coins move off exchanges and into private wallets, treasuries, or institutional custody, it suggests that holders are preparing for long-term holding rather than liquidation.
Those BTC still on exchanges are considered part of the available supply—meaning they could be sold quickly and impact the market.
The “Exchanges Running Dry” Narrative
Amid the exodus, voices in the industry have stoked speculation about supply constraints.
Matthew Sigel, VanEck’s head of digital assets research, remarked:
“Hearing exchanges are out of Bitcoin … Monday 9:30 am might be the first official shortage … it might make sense to get some.”
On Sunday, investor Mike Alfred reported a conversation with the manager of a major over-the-counter (OTC) desk:
“At the current pace, they will be completely out of Bitcoin to sell within two hours of futures opening tomorrow, unless the price goes to $126,000 to $129,000. Things getting wild.”
Whether exchanges literally “run out” is debatable. But the limited supply on platforms could increase buying pressure, particularly in a bullish market.
Price Triggers and Thresholds
Analysts have eyes on critical price levels.
Nate Geraci, president of Nova Dius, observed the disconnect between price action and public awareness:
“Bitcoin hits new all-time high … And most people still don’t even know what Bitcoin is.”
Another analyst, Rekt Capital, suggested that a convincing break above $126,500 could unlock further upward momentum.
Given the backdrop of constrained exchange supply, any major breakout might encounter fewer sellers holding BTC ready to dump.
What This Could Mean for the Market
The reduction in exchange-held Bitcoin could alter liquidity dynamics.
With fewer coins sitting on centralized platforms, large buyers may face more limited sources of supply.
This scarcity could lend strength to upward price moves, particularly if buyers rush in during strong sentiment phases.
However, the risk remains that if sentiment turns or macro pressures intensify, market participants will need to source BTC from thinner venues, potentially exacerbating volatility.
The interplay between price advances and shrinking exchange supply is now a key narrative to monitor in the months ahead.