May Outlook: Hold in May, and stay
Our plan has been clear: reaccumulate BTC south of $80k and hold. We’re now entering a period designated for holding.A historically constrained seasonal period
One mantra has been tried and proven repeatedly in the crypto market – sell in May and stay away. Historically, May to October has offered weaker performance than November through April. There are few fully satisfying explanations as to why we have observed this seasonality of returns, but the vacation effect and tax deadlines may represent one key performance dampener. Further, summers generally tend to see fewer catalysts than the rest of the year. But 2025 is shaped to be different
In crypto, we argue that this is not the case - in the summer of ’25, catalysts are plentiful. While Trump’s overall market impact is an annoyance, one has to accept the market for what it is. Right now, it is a broad Trump trade; his moves impact risk tolerance and skew forward expectations. Onwards, crypto is about to face multiple Trump-driven positive developments, whereas equities may face a tariff repeat – on balance, setting the stage for relative bitcoin strength in the months ahead. Donald Trump’s first crypto-specific executive order gave the crypto working group a 180-day deadline to submit a comprehensive report covering the development of a federal regulatory framework for crypto and evaluating a national digital asset stockpile. The deadline for this report is due on July 22. Trump accelerated the work on the strategic reserve with his March 6 executive order, providing a 60-day deadline for the U.S. treasury to evaluate legal and investment considerations for the SBR. Findings from the report have yet to be disclosed but might represent a significant valve of volatility in the weeks to come.Further, heavier Trump catalysts are also upon the market. Trump’s 90-day tariff pause offered relief to a rapidly deteriorating market in early April. A tariff postponement means one thing – the topic will resurface with all its horrifying glory in the midst of the summer. The likelihood of markets re-experiencing the April chaos is thus relatively high, forcing market participants into risk-averse positioning. On balance, potential positive crypto catalysts and looming downside risk in equities favor BTC ahead.Natural relative BTC strength
During April’s drawdown, BTC proved robust. The deepest down days on the S&P 500 outpaced BTC, a very rare feat of lower BTC beta during periods of market turmoil. The explanation is natural. The aforementioned balance of a potential strategic bitcoin reserve vs. the potential negative company-specific long-term implication of tariffs on earnings and employment points toward stronger fundamentals for BTC over equities. Robust beta, elevated risk aversion
While arguments for relative strength are solid, risk aversion prevails across markets. BTC derivatives have faced weak premiums for weeks, best illustrated by funding rates hovering in negative territory since late April. Traders are not looking to build leveraged long exposure; thus, risks of cascading long liquidations pushing BTC lower are low. This is a constructive observation for medium—to long-term BTC owners and favors aggressive spot exposure ahead. Sold inauguration, rebought sub $80k – now back in it for the ride
While tariffs are due to continue to spark uncertainty in the markets in the months ahead, I have comfortably reallocated back what I sold on the inauguration, with no intention of selling at current prices. I intend to maintain this exposure throughout the summer, as I view the balance of future catalysts onwards as net positive for BTC – favoring patient exposure.
