As of December 8, Bitcoin ETFs collectively hold approximately 1,495,160 BTC, while publicly traded companies possess around 1,076,061 BTC. Together, these entities control nearly 2.57 million BTC—significantly surpassing the roughly 2.09 million BTC stored on centralized exchanges.
The most price-sensitive portion of Bitcoin’s circulating supply of about 19.8 million coins has shifted away from exchange wallets into structures governed by distinct incentives and regulatory frameworks that operate on different capital deployment timelines.
This transition represents more than just a redistribution of ownership; it marks a fundamental transformation in how Bitcoin supply flows through the market. It alters the dynamics of basis trading and volatility patterns because marginal sellers are no longer predominantly retail traders on platforms like Binance but instead include regulated funds, corporate treasury departments, and institutional custodians managing multi-billion-dollar portfolios.
Traditional perspectives viewed exchanges as primary sources of selling pressure for Bitcoin liquidity.
Traders would deposit coins to exchanges where market makers provided spreads; price declines occurred when order book inventories were depleted. While this model remains relevant to some extent today, it now applies to a shrinking segment within the broader ecosystem.
Since early 2024, balances held on exchanges have steadily declined as ETF holdings and institutional custody have expanded significantly.
Recent studies by Glassnode and Keyrock reveal that over 61% of all Bitcoins have remained untouched for more than one year—indicating an effective reduction in available float despite overall supply growth.
The critical question is not whether these developments impact price formation but rather how to understand this evolving infrastructure—and what risks arise when major Bitcoin repositories are balance-sheet entities linked closely with equity markets, debt maturities schedules, and monthly net asset value reconciliations.
The Three-Tiered Supply Structure
Bitcoin’s liquid supply can now be categorized into three distinct pools based on their liquidity characteristics:
- Exchange Float: This is the most responsive pool where coins held in hot wallets at Coinbase, Binance or Kraken can be sold almost instantly by traders who use them for leverage or speculative purposes—the highest velocity sell pressure source. This pool has been contracting over recent years—from millions in early 2021 down to just above two million BTC currently (per Coinglass data).
- ETF Holdings: These represent slower-moving assets but are rapidly growing; U.S.-based spot ETFs accounted for roughly 1.31 million BTC as of early December 2025—with BlackRock’s IBIT alone holding about 777k BTC (according to Bitcoin Treasuries). ETF shares trade on secondary markets with arbitrage performed between share prices and net asset values via authorized participants (APs), involving T+1 or T+2 settlement periods plus custodian coordination & regulatory compliance.
Consequently, ETF-held Bitcoins rarely enter spot order books unless APs redeem shares “in-kind” & transfer coins back onto exchanges—this friction dampens impulsive intraday selling yet may amplify moves during large redemption waves. - Corporate Treasury Holdings: This group acts as a variable factor. Public companies collectively own over one million bitcoins,
with Strategy’s holdings comprising much of this amount.
Listed firms hold approximately 5.1% if total supply according to Bitcoin Treasuries. Drawdowns may force some treasuries underwater increasing chances for forced/opportunistic sales under stress.
Corporate holders face unique pressures compared with ETF investors—they must report mark-to-market losses impacting earnings statements,
The Impact On Basis Trading And Derivatives
The introduction & expansion of ETFs reshaped derivatives markets tied to bitcoin significantly.&
- CME Group outlines basis trades involving buying spot ETF shares while shorting CME futures contracts capturing spreads between spot/futures prices.&
- A surge in leveraged fund short positions within CME futures after spot-ETF launches aligns with hedged carry strategies rather than bearish bets per CME analysis.&
- Dramatic increases in open interest throughout late-2024/early-2025 reflected institutional desks building positions where basis behavior signals arbitrage activity versus directional sentiment exclusively.&
Smoother Volatility Amidst Deeper Liquidity Pools
's long-term realized volatility has dropped nearly fifty percent from mid-80% levels down toward low-40%s across cycles according Glassnode/Fasanara research notes.
Multi-billion-dollar daily trading volumes through ETFs create fundamentally different market microstructures compared with prior eras.
Regulated investment vehicles attract allocators previously unwilling/unable access offshore spots bringing disciplined execution/risk management smoothing extreme swings typical earlier cycles.
Market makers quote tighter spreads near NAV enhancing liquidity depth while institutional buyers rebalance methodically reducing panic-driven sell-offs during downturns.
Yet lower volatility does not equate stability:
Concentration among few large holders—including ETFs/corporate treasuries/whales—means sizable liquidations/redemptions could cause outsized moves beyond diffuse retail selling impacts.
The Swiss National Bank chairperson rejected bitcoin reserve status April ’25 citing ongoing concerns regarding its volatile nature/liquidity shortcomings reminding us even mature infrastructures cannot fully mitigate tail risk required central bank reserves standards.
Treasury Stress Scenarios And Redemption Risks
Treasury accumulation models rely heavily upon rising bitcoin prices alongside affordable financing options such convertible debt issuance covering dilution costs via appreciation gains—a strategy viable only amid bull runs featuring low borrowing expenses.
When btc falls below average cost bases combined credit tightening renders such approaches fragile risking margin calls/refinancing difficulties/increased scrutiny from boards/analysts alike affecting corporate float stickiness relative both long-term holders/exchange inventory alike.
ETFs avoid refinancing dangers but remain exposed redemption risk:
Persistent bear phases triggering outflows prompt authorized participants redeeming shares returning bitcoins back into circulation either directly via sales or indirectly through custodian transfers eventually reaching exchange order books delaying yet redistributing downward pressure temporally without eliminating magnitude entirely.
A New Landscape For Price Discovery And Risk Management
This evolving distribution warrants reclassifying bitcoin's liquid supply landscape—not implying guaranteed upward pricing due solely scarcity constraints:
Glassnode coined "anchored float" concept distinguishing actively traded portions vs dormant supplies locked inside long-term holder wallets/corporate accounts/ETFs custody.
As exchange floats shrink offsetting growth occurs within corporates & regulated products shifting marginal pricing events across venues differing substantially microstructure/delay participant profiles.
Basis trades increasingly integrate spot-futures linkages whereas corporate treasury exposure connects btc fluctuations tightly with equity/debt market conditions regulated funds inject new capital inflows introducing complex redemption mechanics potentially amplifying sentiment-driven movements
Ultimately shifting dominance away from anonymous whales towards public corporations registered investment vehicles custodians overseeing billions representing fundamentally altered ecosystem operating dynamics affecting liquidity risk volatility patterns/arbitrage opportunities/risk exposures uniquely characteristic contemporary bitcoin marketplace.