OVERVIEW

Bitcoin Loves May: Historical Trends Predict A Big Month For BTC 🧠

Before we dive in, here’s today’s crypto market heatmap:

Source: Santiment

And here’s a look at crypto’s total market and altcoin market cap charts:

Source: TradingView

ON-CHAIN ANALYSIS
Bitcoin in May: The Bull Whisperer 🐂📆

May is historically a wild ride for Bitcoin – no slow burn here, just explosive moves, both good and bad. 🎭️ 

With an average monthly return of +11.97%, May outshines Bitcoin’s overall quarterly Q2 average of +7.71%. If you’re into volatility, May is your kind of month.

Top Gainers and Losers

• 2017: +70.38%

• 2019: +60.84%

• 2014: +40.91%

• 2016: +17.93%

• 2024: +11.32%

• 2020: +9.58%

• 2015: -2.54%

• 2023: -6.96%

• 2022: -15.54%

• 2018: -18.85%

• 2021: -35.38%

Weird, Wild, and Wacky May Patterns 🤔🔍

• Bitcoin’s Roller Coaster Month:
  May has delivered Bitcoin’s largest single-month performance gain (May 2017, +70%) and its sharpest monthly decline of recent Q2s (May 2021, -35%). Basically, May doesn’t like moderation.

• Post-April Hangover?
  Historically, strong Aprils don’t always lead to stellar Mays. April 2020 soared +34.57%, but May 2020 mellowed significantly to +9.57%. Conversely, an awful April doesn’t doom May. For example, April 2014 barely budged (+0.20%), yet May jumped to +40.91%.

Zooming Out to Q2 📅

Expanding beyond May, Bitcoin’s Q2 performance tells a similar story of boom-or-bust:

• Average Q2 Return: +7.71%

• Best Q2 Month: May 2017 (+70.38%)

• Worst Q2 Month: June 2022 (-37.32%)

• Median Q2 Return: +5.22%

Interestingly, despite the volatility, Q2 often ends positively. This makes sense because May’s powerful gains usually offset weaker performances in June, averaging out to a solid quarter.

Takeaways & What To Expect 🎯

• May historically is a month of extremes—expect big moves.

• Major corrections or breakouts often happen in May, signaling trend shifts.

• Even if April is dull, May can deliver significant fireworks.

Whether you’re a bull, a bear, or a spectator munching popcorn, buckle up – May is usually a hell of a show. 🍿 

TECHCNICAL ANALYSIS
Ethereum Looks Like A Litter Box That Hasn’t Been Cleaned In Months 🦨 

If you want some evidence that gives support to the saying, ‘news doesn’t matter,’ then just look at Ethereum’s monthly chart. 😢 

ETHUSD Monthly Chart – Click to enlarge.

Ethereum wrapped up April 2025 by stretching its losing streak to five straight months – the second-longest run of monthly losses on record.

And if that didn’t hurt already, consider this: after hitting a three year high in December 2024, Ethereum spent the next five months sliding south, making a new two-year low in April 2025.

But hot damn if Ethereum didn’t recover hard from the lows!

$ETH.X ( ▼ 1.21% ) looks less like road kill and more like Rocky from Rocky III – but in the last part of the movie when he finally beats Clubber Lang via flashbacks of Micky dying and Apollo slow motion spitting/yelling COME ON ROCK. 🥊 

On-Chain Data Has Been Screaming A Bottom Is Coming In Soon 😱 

I feel like I’ve been beating this drum for a bit – turns out I was. Several times we looked at how beaten down Ethereum is/was. Because no matter how to measure it, Ethereum is the worse it’s been since pretty much ever. Slight exaggeration but not by much.

ETH MVRV Dumpster Fire 🔥 

In the April 4, 2025 Litepaper, we looked at the Long/Short Difference and MVRV Z-Score for Ethereum

ETHUSD MVRV Long/Short Difference – Click to enlarge.

Short-term traders regularly flipped bullish-to-bearish, profiting off the backs of battered long-term holders. The MVRV Z-score hovered near undervalued territory (avg: 0.72, low: -0.67), confirming that holders faced constant whipsaws rather than meaningful gains.

Everyone Wants To Sell 🪝 

The April 8, 2025 Litepaper looked at Ethereum’s inflows to exchanges.

XRP Inflows – Click to enlarge.

Inflows were extremely high and were approaching six-month highs.

Altcoin Graveyard 🪦 

We looked at Glassnode’s on-chain data in the April 11, 2025 Litepaper.

Altcoin Market Cap Performance – Click to enlarge.

Glassnode’s data confirmed what everyone’s wallets already knew – this market officially sucks, especially if you’re holding ETH, which tanked harder than BTC, pushing its MVRV ratio under 1.0 and leaving holders underwater.

Realized losses piled up fast, sellers might finally be exhausted (yay?), but with altcoins also hemorrhaging $417B (-40%) in four months, diversification only ensured your pain was evenly distributed. 🤕 

Only 35% Of ETH Addresses In Profit 🤯 

I described Ethereum as a porta-potty explosion at a taco festival in the April 23, 2025 Litepaper. 

Ethereum Percentage of Addresses in Profit – Click to enlarge.

35% is lower than how many addresses were in profit when Terra collapsed in May 2022 or FTX’s collapse in November 2022. 🫡 

NEWS IN THREE SENTENCES
Tether Q1 2025 Breakdown 📰

Tether dropped its Q1 2025 reserves report. On the surface, things look reassuringly solid: USDT is fully backed, and Tether’s balance sheet even boasts a 3.9% cushion. 📜 

But let’s dive into this financial wonderland, because there’s some eyebrow-raising stuff lurking beneath that seemingly safe façade.

Big Assets, Bigger Dividends

First, the fun part: Tether raked in about $852 million in profits last quarter. Pretty good, right? Except the owners promptly helped themselves to a jaw-dropping $2.347 billion dividend.

This hefty payday trimmed Tether’s equity cushion by roughly 21% – a confident move or possibly reckless bravado, depending on your mood. Essentially, Tether owners are saying, “We’re so stable we can afford to shave billions off the reserves and still sleep at night.” 😴 

Cash Reserves? More Like “What Cash?”

One fascinating nugget from this report: out of $149 billion in assets, only $64 million sits as actual cash. 

=Instead, the lion’s share – around $122 billion – is parked in short-term cash equivalents, predominantly U.S. Treasury Bills and overnight repos. It’s safe, liquid, and earnestly earning interest.

But if there’s ever a liquidity crunch or a market apocalypse, let’s hope Tether’s relationship with its main broker and new 21 Capital partner, Cantor Fitzgerald, holds strong – because they’re holding most of these assets. 💰️ 

Bitcoin, Gold, and Loans – Oh My!

Now for the spicy bits. About 19% of Tether’s reserves aren’t exactly stable or typical:

• Bitcoin ($7.66 billion) – not much to say about this one. It’s Bitcoin.

• Gold Bars ($6.66 billion): A flashy hedge against inflation and regulatory skepticism, Tether’s gold stash is safely stashed as LBMA (London Bullion Market Cartel Association) standard bars.

• Secured Loans ($8.83 billion): Lending out nearly $9 billion introduces borrower risk. This raises trust issues for some skeptical eyes, especially given their vague pledge to phase these loans out.

• “Other Investments” ($4.46 billion): It’s a mystery box.

Bottom Line

Assets are genuinely substantial, mostly liquid, and reassuringly boring – but the slice of risky holdings, dividend decisions, and El Salvador relocation might make people nervous.

Then again, Cantor Fitzgerald holds 99% of their Treasuries and they’re BFF’s in that new 21 Capital venture with Softbank, so maybe there’s nothing to worry about. 🤷 

EMAIL ME
Tell Me What You Want 🔊 

Quick note here: Let me know what you’d like to see more of in the Litepaper.

More charts? More on-chain analytics? More data? Let me know! 🎇 

E-mail me here: jmorgan@stocktwits.com

NEWS IN THREE SENTENCES
AI, Stablecoins, & Privacy News 🕵️ 

🌀 Sonic Upgrades to Native USDC & CCTP V2, Devs Celebrate One Less Headache

High-speed blockchain Sonic is transitioning from bridged USDC to native USDC with CCTP V2 support, promising frictionless, near-instant transfers. Developers now have one less interoperability nightmare to deal with, allowing more time to ponder life’s real mysteries – like why they named a blockchain “Sonic.” Users can sit back as their USDC magically upgrades itself, making this officially the least annoying crypto upgrade ever. Circle.

🐺 WT3: Oasis Unleashes Trustless AI Trading Agent, Humans Officially Obsolete

Oasis introduced WT3, an autonomous, verifiable trading bot running securely within a trusted execution environment. Now your crypto portfolio can be managed entirely by a robot wolf, ensuring that any future losses can be conveniently blamed on AI. Privacy, decentralization, and plausible deniability—what more could a modern crypto investor ask for? Oasis.

NEWS IN THREE SENTENCES
DeFi, DEX, & Lending Protocol News 🏦

🥞 PancakeSwap Infinity Launches Farming

PancakeSwap Infinity simplified yield farming by eliminating extra staking steps – just deposit liquidity and start earning automatically. Farmers can now save precious seconds previously spent clicking extra buttons, thus giving them more time to watch their impermanent loss accumulate. PancakeSwap.

🔮 Band Protocol Unveils Oracle v3 Testnet Phase 2

Band Protocol launched Oracle v3 Testnet Phase 2, delivering major improvements in speed, telemetry, and interoperability. Now DeFi apps can get inaccurate price data even faster than before, with slightly less downtime. Band Protocol.

🚀 Bancor’s Arb Fast Lane Smashes Records on Sei

Bancor’s Arb Fast Lane crushed previous records with nearly 170,000 transactions and over 81 billion gas units consumed in April, becoming Sei’s arbitrage powerhouse. While competitors chase hype, Bancor quietly built a DeFi arbitrage monster optimizing trades at lightning speed. Bancor.

LINKS
Links That Don’t Suck 🔗

🥉 Axiom is now the third most profitable platform in DeFi

🪙 Top Satoshi candidate didn’t create Bitcoin, Adam Back claims

😆 Sam Altman’s World got its eyeball count wrong by 14 million

🐎 A robot that you ride like a horse is being developed. It will stretch current limits of engineering

🤯 Tesla chair refutes report detailing plans for Elon Musk’s replacement

🔫 Borderlands 4’s New Loot System Offers More Variety Than Ever Before

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