Fake news has always been a thorn in the side of crypto enthusiasts, just like the unconfirmed speculation on BlackRock’s ETF application. It seems like a regular event but this could cost us much more. Let’s dig into the story.
What Are ETFs?
The acronym ETF stands for Exchange Traded Funds. They are indexes traded on an exchange allowing investors to invest in assets. Investors can put their money into specific ETFs and then diversify their portfolios without braving rigorous alternative processes.
Fake News on BlackRock ETF Approval
The revision of BlackRock’s submission of their iShares Bitcoin spot ETF by the SEC is on. Of course, a lot of media attention has been on the story with expectations of an SEC approval.
Cointelegraph, a leading platform in the crypto journalism space shared a misleading tweet on X. They wrongly confirmed that BlackRock’s ETF application had been approved by the SEC, causing a sharp spike in the prices of Bitcoin after the tweet was published. $BTC hit $30,000 yesterday from around $27k, following the news.
A user in this Telegram channel posted the exact same fake news reported by CoinTelegraph 39 minutes before their tweet.
After they deleted their message and account. pic.twitter.com/CP98ex56ZU
— ZachXBT (@zachxbt) October 16, 2023
However, the same news was posted on a telegram group 39 minutes before Cointelegraph’s tweet. Afterwards, the post and account were deleted, raising speculations of an intentional market manipulation.
🚨BlackRock has just confirmed to me that this is false. Their application is still under review. https://t.co/XIfIWZ0Ule
— Eleanor Terrett (@EleanorTerrett) October 16, 2023
Afterwards, BlackRock went on to deny the speculations and report that their application was still under review. The clarification was consequential, causing Bitcoin’s prices to fall back to a little above its former price of $28K.
Fox Business now reporting reports false, BlackRock says application still under review. https://t.co/5XWn65qlVt
— Eric Balchunas (@EricBalchunas) October 16, 2023
Possible Consequences Of The Fake ETF News Saga
The implications of the recent rumors about BlackRock’s spot ETF surpass a market sway. The SEC has always been extremely critical of crypto-related issues.
The market movements witnessed yesterday show the possibility of crypto market manipulation. This is something that the SEC will use to hold unto its approval.
BREAKING: odds of a Bitcoin ETF approval has gone down from 90% to 15% after this incident
— RookieXBT 🧲 (@RookieXBT) October 16, 2023
Additionally, the use of a cryptocurrency ETF is a novel idea that might not be entirely supported by the SEC. Particularly, market volatility or unpredictability of the market is the major reason the SEC is reluctant about approving an ETF.
A Bitcoin ETF is potentially a connection between traditional investment finance and crypto investment. This connection would mean traditional investment portfolios that have minor relationships with the crypto market now have direct access to the market.
According to Bloomberg Markets, the fake news resulted in a massive $85M liquidation in records.
A fake news report that sparked a brief 10% rally in Bitcoin is shining a spotlight on a crypto industry that’s waiting with bated breath for the arrival of mass-market ETFs https://t.co/NKTaZpdBOD
— Bloomberg Markets (@markets) October 16, 2023
Conclusion
At the end of the day, the victims of the fake news saga are not just crypto traders and investors. It also involves the whole crypto community and the future of a decentralized financial system. Fake news speculations always cause harm, but this saga could cost the entire crypto community.
JUST IN: Cointelegraph issues apology after falsely announcing that BlackRock's Spot #Bitcoin ETF was approved by the SEC. pic.twitter.com/kPxlTY4Oi5
— Watcher.Guru (@WatcherGuru) October 16, 2023
Although the cointelegraph team has issued an apology to the cryptocurrency community and its readers, the impact still remains.
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