“ In 10 minutes, nearly $100 million was spent on the market to pay for CoinTelegraph’s “false news”, of which $72 million was liquidated for short positions and $26 million for long positions.”
Maybe this is a piece of fake news that will go down in history.
On October 16, Cointelegraph reported that the U.S. Securities and Exchange Commission has approved BlackRock’s iShares Bitcoin Spot ETF.
"Bitcoin", "ETF", "APPROVE", when these three highly anticipated words are finally connected together, it is hard to believe that this is actually a piece of fake news worth $100 million.
20 minutes, $100 million liquidated
As the most anticipated development in the global cryptocurrency market, every move of the Bitcoin ETF product has a great influence on this already fragile market. Remember that a few months ago, the rise of Bitcoin to over $30,000 was the market's expectation for the ETF, and when the news of the delay came, the market fell immediately.
Two hours ago, the same thing happened again. The news that the Bitcoin ETF was approved by the SEC was published on social media by the old cryptocurrency media Cointelegraph in all capital letters. The market moved immediately. Bitcoin, with a market value of $550 billion, broke through multiple integers and stood above $30,000. The bull market is back.
In less than half an hour, the tweet was read nearly 1.5 million times. It is hard to imagine that there are so many people in the Crypto industry. But the market soon found something wrong, because mainstream media such as Bloomberg did not report any historical news such as Bitcoin ETF.
Soon, Bloomberg ETF analyst James Seyffart said on social media that the news was suspected to be fake news, and nothing could be found to confirm this.
Subsequently, multiple sources came out to refute the rumors. Bloomberg terminal information showed that BlackRock stated that its Bitcoin spot ETF application is still under review by the SEC.
Cointelegraph released a statement explaining the whole incident: the employee posted the wrong content on platform X without first confirming the authenticity of the information. Subsequently, Cointelegraph finally deleted the wrong information and expressed deep regret for the erroneous release of this information on platform X and the impact it caused.
As the rumors were widely refuted, Bitcoin fell back above $27,000, ending the climax of about 10 minutes.
In 10 minutes, nearly $100 million was spent on this fake news of just seven words, including $72 million in short positions and $26 million in long positions. It seems that there is no winner.
Crypto has never lacked fake news, or it can be said that this is one of the industries with the most fake news in the world, after all, it is directly linked to money. We often see simple or complex fake news such as "a founder was shot dead by the police" or "a project received investment from a top VC".
But even if there is more such false information, the impact on the industry is controllable, and it is far less than the impact on the confidence of the industry caused by fake news such as "the old media used a serious news style of just 7 words to tell us a long-awaited event." We can only guess that Cointelegraph is too willing to believe that this is true, and they have no reason to do something harmful to their industry.
Because Bitcoin ETF is so critical to us now.
What Bitcoin ETFs mean to the industry
Once the Bitcoin spot ETF is officially listed in the United States, it will become a milestone event in the global blockchain field, because it means that the U.S. regulatory authorities have legally recognized the legal status of Bitcoin as a financial product, and Bitcoin will gain unprecedented influence.
Related reading: "Top 12 Bitcoin Spot and Futures ETFs"
If a spot Bitcoin ETF is ultimately approved, it could have a significant impact on the Bitcoin and crypto markets for the following reasons: Mainstream exposure: A spot ETF would provide Bitcoin exposure to tens of millions of new investors through retirement and brokerage accounts in a way that has never been done before. Increased legitimacy: SEC approval would increase Bitcoin’s legitimacy and reduce skepticism among institutional investors and advisors regarding Bitcoin as an investable asset class.
Positive Price Effect: The launch of Canadian and Brazilian ETFs was followed by a sharp rise in Bitcoin prices in 2021. The launch of a spot ETF in the United States could similarly spark investor interest, leading to a similar bull run.
Coinbase CEO Brian Armstrong once talked about Bitcoin spot ETF in an interview, saying that ETF may benefit Coinbase and will also become a new source of capital for the crypto ecosystem.
Based on this, many projects will resubmit their Bitcoin ETF applications after being rejected by the SEC, and will not tire of updating their applications in response to the SEC's requirements. Balchunas, a senior ETF analyst at Bloomberg, said that although approval may not come immediately, the "back and forth communication" between the SEC and the project is a very positive signal.
The ARK 21Shares BTC ETF, jointly launched by Ark Investment Management and 21Shares, has been seeking approval since 2021. So far this year, eight large financial institutions, including BlackRock, have submitted Bitcoin ETF applications to the US SEC.
Bitwise’s application for a Bitcoin ETF came just one day after BlackRock’s application, and despite being rejected by the SEC due to fraud and manipulation issues, Bitwise remained steadfast. Then, WisdomTree, not to be outdone, resubmitted its application for the WisdomTree BTC Trust.
Although both applications were unsuccessful, they still hope to let investors understand the price trend of BTC. Finally, Fidelity Investments also joined the ranks of BTC ETF.
Data shows that as of October 16, at least 11 Ethereum-related ETF applications are awaiting regulatory approval, and these companies have not withdrawn their applications. The SEC has a total of 240 days to make a decision on the application after starting the review, and the first deadline for the next batch of ETF applications is October 17, and Bitcoin ETFs will usher in intensive approvals.
The SEC is expected to respond to Bitcoin ETF filings from Fidelity, BlackRock, VanEck, WisdomTree, Invesco, and Galaxy on October 17. It is also expected to respond to Valkyrie and Hashdex on October 19 and October 29, respectively.
Long-term seesaw of spot EFT
When it comes to Bitcoin ETF applications, we have to talk about Grayscale. Since October 2020, Grayscale has planned to apply to convert its BTC Trust into a spot exchange-traded fund (ETF), but during the past three years, the SEC has rejected it for various reasons.
Grayscale decided to formally file a lawsuit against the SEC a year ago, which also started a litigation tug-of-war between the two parties for more than a year. On the evening of August 30 this year, Grayscale won the lawsuit and overturned the SEC's decision to block the Grayscale ETF.
Related reading: "Grayscale wins the lawsuit against the SEC, does the DCG empire behind GBTC have new hope?"
Due to the complexity of compliance and transactions, it is difficult for institutional investors to directly hold BTC, and for individual investors, the trading and storage of cryptocurrencies have a certain learning threshold. The Bitcoin Trust Fund GBTC managed by Grayscale Investments has helped solve this problem to a large extent.
Therefore, many institutions have participated in the premium arbitrage movement with the help of GBTC's product structure. GBTC tracks the price of Bitcoin but is not completely consistent, and its premium rate has always been one of the important indicators in the cryptocurrency market. Before the crypto market completely turned bearish, GBTC's negative premium trend seemed to become irreversible. In order to change the trust to a spot Bitcoin ETF and correct the "discount" of GBTC, Grayscale has been pushing GBTC to be converted into a Bitcoin spot ETF, but the three applications were ruthlessly rejected by the SEC.
Grayscale’s recent victory suggests the SEC may be forced to approve pending Bitcoin spot ETF applications from various asset managers, including Grayscale, according to a research note from JPMorgan analysts led by Nikolaos Panigirtzoglou on Sept. 3.
On October 14, Bloomberg ETF analysts Eric Balchunas and James Seyffart posted on social media that Ark and 21Shares (Invesco Galaxy has also been updated) recently updated the prospectus for the spot Bitcoin ETF, adding at least five pages of new text. This indicates a constructive dialogue with the SEC, a step that usually only occurs when the ETF is about to be approved.
We believe there is a 90% chance that the spot Bitcoin ETF will be approved before Ark's January 10 application deadline. According to Fox Business reporter Eleanor Terrett on the social platform on October 16, Grayscale issued a statement regarding the US SEC's decision not to seek an appeal: "The 45-day deadline for seeking a retrial under the Federal Rules of Appellate Procedure has expired. The court will issue a final authorization within 7 days. The Grayscale team is ready to convert GBTC into an ETF once the SEC approves it."
Related reading: "Grayscale says it is ready to convert GBTC into an ETF. How long will it take for the Bitcoin spot ETF to arrive?"
But earlier on October 14, Bloomberg ETF analyst James Seyffart posted on social media that the dialogue between Grayscale and the SEC will begin next week, and the SEC is likely to make a new response to Grayscale’s application to "convert GBTC to a Bitcoin spot ETF" within the next two weeks.
On the same day, Reuters quoted people familiar with the matter as saying that the U.S. SEC does not plan to appeal the court's ruling in the case of "Grayscale's application to convert GBTC into a spot ETF", and the decision may pave the way for the SEC to review Grayscale's Bitcoin spot ETF application.
But no matter how long it takes for the ETF to be passed, we seem to be able to see from tonight’s extreme price performance that the market may be ready to welcome spot ETFs and start the next bull market.
Conclusion
Do you still remember the reasons why the ETF was not approved?
"The cryptocurrency world is too easy to manipulate"!
Well now @cointelegraph has sent proof during the approval phase.
✏️Disclaimer: This article is for reference only, DYOR
Source: Alpha Investment Research, Zhang Wen
(Looking for community cooperation) Can WeChat and Alipay directly use "oil" for daily consumption? Biquan artifact, supports cash withdrawal from mainland ATM!
What is the difference between another popular Tomo and FriendTech?
JPMorgan Chase | The world's first money market fund on the blockchain! Is it an opportunity or a trap?
「Alpha DAO」
A Chinese Web3 community that does not want to be cannon fodder;
Track the latest hot spots and interpret industry tracks;
Take advantage of the wind and share common prosperity.
