Sell in May and go away, is a well-known saying within the crypto world that advises investors to sell their crypto at the beginning of the month of May. This strategy refers to the seasonal weakness in the stock market and has now spilled over to the digital asset market. Looking at the results of the crypto market over the past month, in a way it was a good choice to exit the market.
The major American investment bank Goldman Sachs has in a research report shared an analysis about bitcoin (BTC) and ethereum (ETH) from the past month.
BTC and ETH price performance
For many investors, it is ultimately about price performance. Bitcoin ended the first four months of the year in the green, but May managed to put an end to this beautiful series. For the first time since 2022, bitcoin closed the month in the red. In fact, the bitcoin price fell by a total of 8 percent in the past month.
Ethereum, on the other hand, ended May with 0.19 percent in the green. With this it managed to register its fifth green month in a row, although it was of course anything but a convincing increase.
Blockchain analysis
Due to the transparent nature of the blockchain, Goldman Sachs knew interesting on chain to summarize data.
The Spent Output Profit Ratio (SOPR) for bitcoin, which indicates the degree of profit realized, experienced a number of spikes throughout the month, reaching levels not seen since December 2020. This suggests that investors have often taken their profits and actually ‘walked out of the market’.
In addition, the number of bitcoin on crypto exchanges has fallen by as much as 12 percent in the past month. Recently you could also read in the Ethereum news that the amount of ether on crypto exchanges has dropped to a level not seen since 2016.
Network congestion on both Bitcoin and Ethereum was also a major focus in May, the bank said. As a result, monthly address activity for Bitcoin and Ethereum fell by 13.8 percent and 16.7 percent, respectively, as user activity was deterred by higher transaction fees. Transaction fees on Ethereum are currently at their lowest level in two months.
The report also noted that ether balances between cohort groups have remained largely unchanged, but bitcoin addresses with more than 100,000 BTC are seeing a 31 percent monthly decline.