Bitcoin experienced a significant 7% surge earlier today, driven by widespread rumors suggesting that the Securities and Exchange Commission (SEC) had given the green light to the iShares Bitcoin spot exchange-traded fund (ETF). However, this fleeting optimism was abruptly extinguished when BlackRock publicly discredited the misinformation.
In a conversation with Fox journalist Eleanor Terrett, BlackRock emphatically refuted the claims of approval, clarifying that their ETF application is still in the process of being reviewed. Subsequent to this correction, Bitcoin’s value plummeted by 6%, swiftly plummeting from $30,000 to $28,000 in a mere quarter of an hour, as per data from Kraken.
The initial rumor precipitated a cascade of short and long liquidations across various crypto derivatives exchanges, amassing nearly $80 million in short liquidations and over $30 million in long liquidations, as revealed by CoinGlass data. Liquidation is the automatic closure of a leveraged position by an exchange due to the trader’s inability to cover their initial margin loss.
Though the misleading Twitter post was promptly removed within an hour of its appearance, it had already disseminated through social media channels, impacting cryptocurrency prices and eliciting an apology from Cointelegraph.
Notably, the previous week witnessed the SEC’s decision to refrain from appealing its defeat in the Grayscale case, enhancing the prospects of the Grayscale Bitcoin Trust (GBTC) potentially evolving into a spot ETF. Analysts at Bloomberg are now estimating a 90% likelihood of a Bitcoin spot ETF receiving approval by January 2024.
As of the latest data from CoinGecko, Bitcoin has witnessed a 4% increase over the past week, and its current trading price hovers slightly above $28,000.