Due to investors transferring Bitcoin to private wallets and long-term custody accounts, the available supply has tightened, and Bitcoin exchange reserves have fallen to approximately 2.7 million coins, the lowest level since 2018. This outflow of funds is partly driven by the increase in US spot ETFs and institutional investors, reducing immediate liquidity on the sell side and creating structural supply tightness, which could amplify price volatility. Meanwhile, about 40-45% of circulating Bitcoin supply is in loss, a typical level during the early stages of a bear market. Although selling pressure has eased, traders remain cautious.