Retail Bitcoin Inflows to Binance Drop Over 80%
- •Retail Bitcoin inflows to Binance down over 80% since early 2023
- •Investors are moving to ETFs or holding BTC longer
- •Many small investors are now outgrowing the “shrimp” category
Retail Bitcoin inflows to Binance have taken a major hit, plunging by more than 80% since the beginning of 2023. This sharp drop highlights a significant shift in the behavior of small Bitcoin investors, often referred to as “shrimps” (those holding less than 1 BTC). Once highly active on centralized exchanges like Binance, these retail players are now taking a different approach to their crypto strategies.
Why Are Retail Investors Moving Away?
There are several reasons behind this downward trend in retail Bitcoin inflows:
The Rise of Bitcoin ETFs: With the launch and growing popularity of Bitcoin ETFs, many retail investors find these regulated, easily accessible financial products a safer and more convenient option. ETFs offer exposure to Bitcoin without needing to manage wallets or deal with exchange complexities.
Long-Term Holding Strategy: Retail investors are increasingly adopting a “HODL” mindset. Rather than frequently trading or transferring BTC to exchanges, they are choosing to hold their assets in self-custody wallets, contributing to the drop in exchange inflows.
Investors Leveling Up: Over time, consistent accumulation and bullish market momentum have pushed their holdings past 1 BTC, moving them into higher-tier investor categories. As they grow, their behavior mirrors more experienced holders, who typically avoid centralized platforms.
UPDATE: Retail Bitcoin inflows to Binance have plunged over 80% since early 2023, as small investors shift to ETFs, hold longer, or move beyond the “shrimp” category. pic.twitter.com/JCkFIAS56r
— Cointelegraph (@Cointelegraph) November 3, 2025
What This Means for Binance and the Market
The decline in retail Bitcoin inflows could signal a maturing market. Retail users are becoming savvier, favoring long-term strategies over frequent trading. For Binance and other exchanges, this shift may mean a need to adapt services to retain user engagement or appeal to newer demographics entering the space.
It also underscores how Bitcoin’s investor landscape is evolving, with a clear tilt toward institutional products and long-term holding behavior. This change could lead to more price stability but might reduce the volatile spikes driven by retail buying frenzies in the short term.