Bitcoin Profit-Taking Accelerates After Golden Cross: Insights for Investors

Main Points :

• Bitcoin’s 50-day simple moving average crossed above its 200-day average on May 22, 2025, confirming a golden cross and propelling BTC to an all-time high above $111,000. 
• On-chain data (entity-adjusted realized profits) spiked above $500 million per hour multiple times in the 24 hours following the golden cross, indicating intensified profit-taking.
  
• The entity-adjusted spent output profit ratio (SOPR) also rose sharply, reflecting the average coin realizing a 16% gain— the strongest profit-taking since February 2025.
  
• Institutional flows remain a key driver: BlackRock’s Bitcoin ETF saw a $58 million inflow on June 4, 2025, while ARK 21Shares announced a 3-for-1 share split to boost retail access. 
• Truth Social filed to list a new Bitcoin ETF on NYSE Arca, underscoring growing mainstream interest and potential liquidity inflows.
  
• The Japanese market may benefit from a weaker yen, tax considerations, and stable regulatory oversight by the Financial Services Agency (FSA).

Golden Cross: Definition and Significance

On May 22, 2025, Bitcoin’s 50-day simple moving average (SMA) crossed above its 200-day SMA, confirming a golden cross—a bullish technical indicator signaling sustained upward momentum. Historically, a golden cross has often preceded major rallies, as market participants interpret it as a sign of long-term trend reversal. In Bitcoin’s case, the golden cross coincided with the token reaching a new all-time high above $111,000 on the same day, per TradingView and CoinDesk data. 

The golden cross is widely regarded as a powerful bullish signal in traditional equity and commodity markets, and its application to Bitcoin reflects the maturing of crypto technical analysis. When short-term momentum (50-day SMA) overtakes long-term momentum (200-day SMA), algorithmic strategies and institutional traders often trigger buy orders, reinforcing positive price action.

Surge in Profit-Taking

Within the 24 hours after the golden cross, on-chain metrics revealed three distinct spikes in entity-adjusted realized profits (EARP) exceeding $500 million per hour. EARP measures the total USD profit across all moved coins when the current transaction price exceeds the price at which those coins were last moved, excluding intra-entity transfers. This adjustment isolates genuine profit-taking activity rather than wash trades or internal transfers.

Glassnode data showed that the average coin moved realized a 16% profit, marking the most intense profit-taking since February 2025. Simultaneously, the proportion of trading days yielding under 8% profit dropped, indicating a shift from marginal to meaningful profit extraction.

From an investor’s perspective, such accelerated profit-taking can be interpreted in two ways. First, it reflects traders locking in gains at historic price levels. Second, it can increase short-term volatility, as large sell orders fill order books. Yet, in a healthy market cycle, taking profits after a rally can recycle capital into new entrants who buy on pullbacks, maintaining market liquidity and supporting longer-term uptrends. 

On-Chain Metrics and SOPR Indicator

In addition to EARP, entity-adjusted SOPR (spent output profit ratio) climbed significantly, confirming that coins leaving addresses were sold at a profit relative to their acquisition cost. The SOPR is calculated as the ratio of the price at which coins are spent to the price at which they were last moved; adjusting for entities removes internal transfers, offering a clearer view of genuine market behavior. 

A rising SOPR above 1.0 signals that on average, coins are being sold at higher prices than they were acquired—indicative of profit-taking by holders. In early June 2025, the SOPR rose above 1.16, reinforcing that most realized gains were captured at around a 16% premium. By comparison, in February 2025 when Bitcoin hovered around $70,000, the SOPR rarely exceeded 1.08, illustrating a less aggressive distribution phase. 

Monitoring SOPR and related on-chain metrics helps investors differentiate between distribution phases—when long-term holders sell en masse—and accumulation phases, when more coins flow onto wallets than exchanges. During profit-taking surges, SOPR spikes may precede short-term price corrections as liquidity absorbs sell pressure. Conversely, if SOPR normalization coincides with declining exchange balances, it can signal renewed accumulation by long-term holders, often preceding subsequent bull runs. 

Market Context and Investor Psychology

Institutional Demand and ETFs

Institutional flows continue to be a dominant theme in mid-2025. On June 4, 2025, BlackRock’s Bitcoin ETF recorded a $58 million net inflow, according to Farside Investors. Such capital injections indicate that traditional asset managers and wealth allocators are increasingly viewing Bitcoin as a legitimate asset class and inflation hedge. Meanwhile, ARK 21Shares announced a 3-for-1 share split for its ARKB ETF, effective June 16, 2025, to lower per-share prices and entice retail participation without altering the ETF’s net asset value.

These developments come in the wake of the U.S. Securities and Exchange Commission’s January 2024 approval of spot Bitcoin ETFs, legitimizing Bitcoin in the eyes of institutional allocators and paving the way for over $38 billion in ETF inflows in early 2025. The share split decision for ARKB follows its YTD performance—up nearly 12%—and an approximate $104.25 closing price, reflecting both strong demand and a desire to enhance liquidity.

Further fueling interest, Truth Social (owned by Trump Media and Technology Group) filed to list a Bitcoin ETF on NYSE Arca on June 3, 2025. This move underscores a broader trend: digital assets are being embraced by mainstream media and political platforms, potentially attracting new capital from retail and politically-aligned demographics who use Truth Social. If approved, the Truth Social Bitcoin ETF could simplify exposure by removing custody and operational complexities, thus drawing more conservative or first-time crypto investors.

As institutional flows into Bitcoin ETFs surge, trading desks report heightened liquidity in both spot markets (e.g., BTC/USDT pairs on Binance, Coinbase) and derivatives. Glassnode data from early June 2025 highlights that CME futures open interest rose by 10% to $5.2 billion on June 4, 2025, indicating heavier positioning by institutional traders. 

Retail Behavior and Profit Cycles

Retail investors often react to media hype and price spikes by participating in momentum rallies. During the golden cross on May 22, 2025, spot trading volume across major exchanges surged by 18%, reaching $41 billion in 24 hours. Social sentiment—gauged via Twitter and X—showed a 25% increase in mentions of “buy Bitcoin” and “profit-taking” on June 3–4, 2025, reflecting FOMO (fear of missing out) mixed with anticipatory profit realization. 

When average coins realize 16% gains, as indicated by SOPR, less seasoned traders may interpret profit-taking as the start of a long-term correction, potentially selling too early. However, historical cycles show that after major profit-taking events, Bitcoin often consolidates for several weeks before resuming its bullish trend. For instance, after the August 2020 golden cross, Bitcoin consolidated around $12,000–$14,000 for two months before rallying to $20,000 in December 2020.

Understanding retail psychology—buying on breakouts and selling on perceived tops—can help more disciplined investors employ strategies such as dollar-cost averaging (DCA) or layered profit-taking, selling partial positions at predetermined price levels to lock in gains while retaining exposure for potential upside.

Investment Strategies and Practical Applications

Layered Profit-Taking

Rather than liquidating entire holdings at once, slicing profits into several tranches at incremental price points can mitigate the risk of missing further upside. For example, an investor with 1 BTC purchased at $60,000 might sell 0.25 BTC at $100,000, another 0.25 BTC at $110,000, and hold the rest to capture potential further gains above $120,000. This approach is particularly relevant after a golden cross when price volatility can bring rapid spikes and pullbacks.

Integrating Technical and Fundamental Analysis

While the golden cross is a potent technical signal, coupling it with on-chain metrics (e.g., SOPR, exchange net flows, realized cap) and macro fundamentals (e.g., ETF flows, regulatory developments) provides a more robust decision framework. For instance, when SOPR normalizes back toward 1.0 after a spike, while exchange balances decline, it can signal that profit-taking has plateaued and accumulation by long-term holders is underway, suggesting a favorable entry point. 

Fundamentally, institutional inflows—evidenced by BlackRock’s $58 million purchase on June 4, 2025—and positive regulatory signals (e.g., stablecoin bills advancing through Congress, increased clarity from the FSA in Japan) support medium-term price appreciation. Combining these metrics can help investors distinguish between healthy consolidation and the onset of a deeper correction.

Risk Management and Portfolio Diversification

Given the volatile nature of Bitcoin, position sizing and stop-loss orders are essential. A prudent investor might limit Bitcoin allocations to 2–5% of overall liquid assets, aligning with BlackRock’s recommended range for crypto exposure among institutional clients. Additionally, setting stop-loss triggers at 10–15% below entry levels can help preserve capital if the market unexpectedly reverses due to macro shocks or regulatory clampdowns.

Diversifying across blockchain-related assets—such as Ethereum, Solana, and other altcoins—can capture potential “altcoin season” momentum when institutional flows shift toward Ethereum ETFs. Notably, on June 2, 2025, Ethereum ETFs logged $78.2 million in net inflows even as Bitcoin ETFs experienced $267.5 million in outflows, highlighting shifting investor sentiment. 

Future Outlook and Risk Factors

Macro and Regulatory Catalysts

Several catalysts could drive Bitcoin’s price trajectory in H2 2025:

• Continued ETF inflows: With over $38 billion already allocated to Bitcoin ETFs in H1 2025, any renewed institutional capital could push BTC beyond $120,000.
  
• Corporate treasury adoption: Public companies like MicroStrategy and Tesla may expand their Bitcoin holdings as a hedge, further reducing available supply. According to Bitwise’s mid-2025 data, corporate treasuries accounted for a substantial share of BTC demand. 
• Regulatory clarity: In the U.S., progress on stablecoin legislation and spot ETF approvals can enhance market confidence. Reuters reported on June 3, 2025, that the U.S. Senate advanced a stablecoin regulation bill, a signal of legislative support for digital assets. 
• Global macro volatility: Inflation pressures and shifting monetary policy may drive risk-averse capital into Bitcoin as a digital store of value. Following the May 2025 U.S. CPI report indicating a 4.1% annual inflation, market participants flocked to BTC, driving price spikes.

Potential Risks

Despite bullish signals, investors should be mindful of:

• Oversized profit-taking: Large-scale sell orders following peak SOPR readings could trigger a deeper correction, especially if paired with adverse macro news. For example, after Bitcoin rose to $69,500 on June 4, 2025 (per CoinGecko), net realized profits peaked, temporarily dampening enthusiasm. 
• Regulatory reversals: Sudden policy shifts—such as Japan’s FSA imposing stricter margin requirements—could reduce retail and institutional inflows, pressuring prices. The FSA has signaled its intent to monitor crypto derivatives closely, which may limit leverage in the domestic market.
• Liquidity shocks: If a major exchange experiences an outage or large-scale hack, market liquidity could evaporate, amplifying price swings. Historical incidents, like the March 2025 exploit of a DeFi platform on Solana, caused a 5% intraday BTC drawdown, demonstrating crypto’s systemic interconnectedness. 
• Crypto winter potential: Despite 2025’s bullish rally, some analysts warn of an impending “crypto winter,” pointing to cyclical history. During the 2018–19 bear cycle, Bitcoin lost over 80% from its peak, suggesting investors should remain cognizant of market cycles. 

Impact on Japanese Market and Investment Opportunities

Yen Depreciation and Portfolio Diversification

As the Japanese yen weakens against the U.S. dollar—trading around ¥145 per $1 in early June 2025—Japanese investors holding Bitcoin in USD terms benefit from currency gains when converting back to yen. For instance, a 10% BTC price increase translates to a 10% return in USD, which could equate to more than 20% in JPY if the yen continues to weaken by 12% over the same period. 

Tax Considerations

Profits from cryptocurrency are subject to summation and progressive income tax rates in Japan, which can reach up to 55% at the highest bracket. Japanese investors realizing gains above ¥5 million are advised to report them under “miscellaneous income” and budget accordingly for tax liabilities. Utilizing tax-loss harvesting— offsetting crypto gains with losses from underperforming positions—can reduce taxable income.

Regulatory Environment

The Financial Services Agency (FSA) maintains relatively stable regulations for crypto exchanges but has been tightening guidelines around margin trading and stablecoin issuance. For Japanese exchanges, leverage limits were reduced to 2x as of April 2025 to protect retail participants. Looking ahead, the FSA’s potential approval of a domestic Bitcoin ETF could open new onshore investment channels, similar to the U.S. market’s ETF-driven price rallies.

Practical Blockchain Applications

Beyond investment, Japanese businesses are exploring blockchain for supply chain management, tokenization of real estate, and digital identity solutions. For example, a consortium of Japanese automotive suppliers has piloted a blockchain-based parts tracking system on Hyperledger Fabric, reducing counterfeit risk and improving traceability. As institutional demand for Bitcoin rises, enterprise blockchain adoption could further legitimize crypto infrastructure, driving ancillary service and technology revenues. 

Getting Started with Bitcoin

1. Choose a Reliable Exchange or Wallet
   
   • Opt for exchanges registered with Japan’s FSA, such as bitFlyer, Coincheck, or Binance Japan, which comply with KYC/AML regulations.
   • For self-custody, consider hardware wallets like Ledger or Trezor to hold private keys offline.
2. Establish an Investment Plan
   
   • Determine your risk tolerance and allocate a modest percentage (e.g., 2–5%) of liquid assets to Bitcoin.
     
   • Use dollar-cost averaging (DCA) to mitigate volatility by purchasing fixed USD amounts on a weekly or monthly basis.
     
3. Monitor Technical and On-Chain Indicators
   
   • Track moving averages (50-day, 200-day) for golden cross/death cross signals. 
   • Use platforms like Glassnode to watch SOPR, exchange net flows, and realized cap for profit-taking and accumulation signals. 
4. Implement Risk Management
   
   • Set stop-loss orders at 10–15% below entry to lock in downside protection.
     
   • Consider taking partial profits at predetermined price levels (e.g., $100,000, $110,000, $120,000) to secure gains.
5. Stay Informed on Regulatory Developments
   • Follow FSA announcements for domestic regulatory changes, such as margin trading limits and exchange licensing.
   • Track global ETF filings (e.g., Truth Social, ARK 21Shares) for potential liquidity shifts.
     

Conclusion and Summary

The golden cross on May 22, 2025, marked a pivotal moment for Bitcoin, propelling it to a new all-time high above $111,000 and triggering accelerated profit-taking, as evidenced by multiple hourly spikes over $500 million in entity-adjusted realized profits and a 16% average gain per coin sold. While profit-taking can induce short-term volatility, it also recirculates capital, enabling fresh entrants to accumulate BTC during pullbacks.

On-chain indicators such as SOPR further confirmed robust profit realization, raising SOPR levels to historically high territory, analogous to February 2025’s distribution phase. Observing SOPR normalization alongside declining exchange balances can provide clues for when accumulation resumes. 

Institutional flows remain a central catalyst. On June 4, 2025, BlackRock’s Bitcoin ETF recorded a $58 million inflow, while ARK 21Shares prepared a 3-for-1 share split to broaden retail access. The Truth Social Bitcoin ETF filing on NYSE Arca further underscores growing mainstream interest, potentially channeling additional liquidity into the market. 

For Japanese investors, a weaker yen amplifies USD-denominated BTC gains, though tax considerations (up to 55% marginal rates) and FSA regulations (e.g., 2x margin limits) necessitate careful planning. Moreover, pragmatic blockchain applications—such as supply chain tracking—demonstrate that crypto’s utility extends beyond price speculation, fostering real-world adoption in Japan. 

Ultimately, combining technical analysis (monitoring moving averages, SOPR, exchange flows) with fundamental insights (ETF inflows, regulatory updates) and risk management (position sizing, stop-loss orders, layered profit-taking) can help investors navigate the post-golden-cross landscape. While Bitcoin faces potential headwinds—such as regulatory reversals, macro uncertainties, or liquidity shocks—the prevailing bullish momentum suggests that properly timed entry points could yield significant returns. For those seeking new crypto assets, revenue opportunities, and practical blockchain applications, now may be an opportune time to engage, armed with structured strategies and a clear understanding of market dynamics.