Bitcoin’s ETF: Volatile Surge, Conflicting Reports, and $100 Million Liquidations

On Monday, the cryptocurrency market experienced significant turbulence as Bitcoin surged before relinquishing most of its gains. The volatility was triggered by conflicting reports regarding approving a Bitcoin exchange-traded fund (ETF) filed by major asset manager BlackRock.

The Rollercoaster Ride of Bitcoin’s Price

Bitcoin, known for its price swings, initially rose by 10% to $29,900, reaching its highest point since August, before settling at a 3% gain at $28,000. The catalyst for this surge was a crypto news outlet, CoinTelegraph report, claiming that the U.S. Securities and Exchange Commission (SEC) had given the green light to BlackRock’s application for a spot bitcoin ETF.

However, the optimism was short-lived as a Fox Business reporter contradicted the report on Twitter. The reporter stated that BlackRock had confirmed that the information was false and their application was still under review by the SEC. BlackRock later affirmed this to Reuters: “The iShares Bitcoin ETP application is still under review.”

🚨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

The SEC did not immediately respond to requests for comments, leaving the crypto markets in suspense. The approval of BlackRock’s application is considered a potential game-changer for the sector, with expectations of increased investment.

Joseph Edwards, head of research at London crypto firm Enigma Securities, noted, “The move does show how monomaniacally obsessed the bitcoin market is with the coming spot ETFs,” emphasizing their significant impact on Bitcoin.

Impact of ETF Rumors on Market Sentiment

In the wake of the conflicting reports, the crypto market witnessed over $100 million in liquidations, with more than $71 million tied to Bitcoin in the last four hours. The rollercoaster price ride showcased the market’s sensitivity to news surrounding ETF approvals.

BlackRock’s clarification followed a recent statement by the SEC, indicating no intention to appeal an August court decision related to Grayscale Investments’ bid for a spot Bitcoin ETF. Despite the anticipation, the SEC’s decision not to appeal doesn’t guarantee future approvals.

As rumors of the ETF approval spread, Bitcoin’s price surged towards $30,000. However, as confirmations arrived, the value retraced to $28,183.44, reflecting a 5% gain in the past 24 hours. The 24-hour trading volume saw a remarkable 350.68% increase.

Market analysts weighed in on the situation, some highlighting the extreme volatility and others suggesting a potential surge if a BTC ETF is approved. Advice circulated among investors included considering a “buy the rumor, sell the news” strategy.

Amidst the market chaos, CoinTelegraph apologized for the misleading information, citing an internal investigation and pledging transparency in sharing their findings within the next three hours. The incident underscores the unpredictability and susceptibility of the crypto space to rumors and speculation despite its growing maturity.

We apologize for a tweet that led to the dissemination of inaccurate information regarding the Blackrock Bitcoin ETF.

An internal investigation is currently underway. We are committed to transparency and will share the findings of the investigation with the public once it is…

— Cointelegraph (@Cointelegraph) October 16, 2023