Centralized trading platforms have witnessed a notable decline in Bitcoin reserves during May 2025, with the amount held dropping below 2.5 million Bitcoins, according to CryptoQuant data. This decline coincided with Bitcoin reaching its all-time high price, exceeding $111,500.
This disparity between the drop in reserves and rising prices is a significant technical indicator, as historically, a decrease in the supply of Bitcoin on exchanges is viewed as a major driver of price increases, especially amid rising demand. It seems that institutional accumulation is significantly reshaping market dynamics. Large wallets, holding between 1,000 and 10,000 Bitcoins, continue to buy and store them away from exchanges, in what is known as cold storage.
A prominent example of this is Strategy company, which added 7,390 Bitcoins to its holdings in May, bringing its total to 576,230 Bitcoins, representing about 2.75% of the total global supply, with an average purchase price of $69,726.
Other companies, including GameStop and the Japanese Metaplanet, have also seen notable increases in their holdings. On the governmental level, both the United Arab Emirates and Pakistan have intensified their efforts to accumulate Bitcoins, while U.S. lawmakers discuss the possibility of establishing a national Bitcoin reserve, a move that could enhance its status as a strategic asset.
As for Bitcoin exchange-traded funds (ETFs), they recorded strong inflows of $5.23 billion during May, according to SoSoValue data, reflecting continued institutional interest despite short-term volatility.
Technically, Bitcoin's price movement is in a state of anticipation. Short-term averages indicate potential selling pressure, but in the long run, the overall trend remains bullish, especially with the price trading above the 200-day moving averages.
If Bitcoin manages to reclaim the short-term moving average around $106,000, it may rise toward the $110,000 barrier or higher. However, if it fails to maintain its support, it is likely to test levels of $98,000 or even $94,000 before any potential rebound.
