Experts Clarify Reasons Behind Decline in Binance’s Bitcoin Reserves

Bitcoin reserves on Binance decline due to market changes, not bearish trends.

The reduction in Bitcoin reserves on Binance is attributed to structural market changes rather than bearish sentiments, according to XWIN Research Japan.

Why Binance’s Bitcoin Reserves Are Declining

“Historically, such conditions have supported medium- to long-term price appreciation. The current trend suggests that Binance’s reserve decline is a normal re-accumulation phase.” – By @xwinfinance pic.twitter.com/g3TCG4o6GD

— CryptoQuant.com (@cryptoquant_com) December 3, 2025

Despite the asset’s price hovering around $93,000, analysts believe this process is part of a healthy bullish trend.

The primary reason for the outflow of funds is the shift towards self-custody. As the market grows, long-term investors and whales are moving coins to cold wallets. This reduces potential selling pressure and demonstrates participants’ confidence in further growth, experts noted.

The reduction in exchange reserves has been driven by increased demand for spot Bitcoin ETFs in the US. Capital inflows into funds like BlackRock, Fidelity, and Vanguard result in Bitcoins being moved to external custodians for storage.

This process enhances spot demand while simultaneously reducing exchange balances on trading platforms, confirming institutional acceptance of the asset.

Short-term impacts included liquidations in the derivatives market at the end of November and increased compliance measures by Binance, added XWIN Research. Users are reallocating assets to comply with new regulatory standards.

Experts concluded that the reduction in exchange supply creates a scarcity of digital gold. Historically, such conditions have supported price increases in the medium to long term.

Bull Market in 2026

Alice Liu, Head of Research at CoinMarketCap, anticipates a market recovery in the first quarter of 2026.

“We are going to see a market comeback in Q1 of 2026. February and March will be a bull market again, based on a combination of macro indicators.” — Alice Liu, Head of Research at CMC, on market cycles pic.twitter.com/ROk2dlqzLH

— Binance (@binance) December 3, 2025

According to her, the return to a bullish phase will occur in February or March. The expert based her forecast on a combination of macroeconomic indicators.

Back in December, an analyst under the pseudonym CoinCare pointed out a signal for the continuation of the market rally.