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Fake Bitcoin ETF Approval Report Causes Brief BTC Price Spike

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Fake Bitcoin ETF Approval Report Causes Brief BTC Price Spike

  • On Monday, a false tweet falsely claiming SEC approval for a BlackRock Spot Bitcoin ETF led to market events.
  • Bitcoin’s price surged from $27,900 to over $30,000 due to the fake report.
  • Prices quickly fell back to $28,000 as the misinformation was exposed.

A false tweet claiming the SEC approved a Spot Bitcoin ETF by BlackRock ignited a brief crypto rally and over $100 million in liquidations across exchanges on Monday.

Bitcoin spiked from $27,900 to over $30,000 following the fake report, which was posted on a Twitter account impersonating Financial News London. Prices quickly tumbled back to $28,000 as analysts and journalists highlighted the misinformation and lack of any actual filing on the SEC site.

BlackRock confirmed it does not have an approved Bitcoin ETF application, contrary to the fabricated tweet. Last week, reports suggested the SEC wouldn’t appeal a court decision that could pave the way for Grayscale’s GBTC to convert to an ETF.

Per CoinGlass, shorts worth $72 million were liquidated in Bitcoin’s surge above $30,000, while approximately $31 million of longs were wiped out in the ensuing correction.

Debunked report underscores eagerness for Bitcoin ETF

The dramatic market reaction shows the level of anticipation surrounding the eventual SEC approval of a spot crypto ETF in the US. With heavyweights like Fidelity and BlackRock seeking permission, any hints of progress can spark irrational exuberance.

While the prospect of an ETF remains enticing, this temporary price distortion highlights the need for traders to verify information before overreacting. As crypto matures, avoiding knee-jerk responses to rumors will only grow in importance.

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