Bitcoin Surges and then Drops After BlackRock Denies Cryptocurrency Report
Bitcoin experienced a sudden surge in value on Monday, only to lose most of its gains after asset manager BlackRock denied a report from a cryptocurrency media outlet claiming that US regulators had approved its high-profile application for a crypto investment product.
Rise and fall
The volatile cryptocurrency was last seen trading up 3.82% at $28,211, following an earlier spike of 10% to $29,900, its highest point since August. The report from Coin Telegraph, which erroneously claimed that the US Securities and Exchange Commission had given the green light to a spot bitcoin exchange-traded fund (ETF) by BlackRock, contributed to the jump. However, the excitement was short-lived after a reporter from Fox Business used social media platform X to announce that BlackRock had refuted the report, causing the value of bitcoin to plunge.
Clarification from BlackRock
Following the confusion, BlackRock confirmed to Reuters that the iShares Bitcoin ETP application is still under review by the SEC. Sources close to the SEC also confirmed that the assertion is indeed true, emphasizing that the application remains pending.
Unintended consequences
Reacting to the situation, Ben Laidler, global markets strategist at eToro, remarked, “Crypto markets have just shown how sensitive they are to any potential good news, with their premature rally today on rumors of the approval of a spot bitcoin ETF.”
Apologies and internal investigation
Coin Telegraph, in a post on X, apologized for its earlier report and issued a statement expressing its commitment to transparency and shared intentions to provide public updates on the results of an internal investigation within three hours. The media outlet also deleted the original post as part of its corrective action.
Awaiting SEC decisions
Crypto markets are eagerly waiting for news on several pending spot bitcoin ETF applications that, if approved, are expected to significantly boost investment in the sector. However, the SEC has so far denied all such applications, citing concerns about the protection of investors from market manipulation.
Implications for the market
Market experts weighed in on the situation, with Joseph Edwards, head of research at London crypto firm Enigma Securities, noting, “The move does show how monomaniacally obsessed the bitcoin market is with the coming spot ETFs.” Lucas Kiely, chief investment officer at Yield App, highlighted the impact of “headline risk” in creating market volatility ahead of the impending SEC announcement.
Legal developments
The broader context includes a recent report from Reuters that stated the SEC would not appeal a court ruling that found it was incorrect to reject an application from Grayscale Investments for a spot bitcoin ETF. This decision is expected to prompt the SEC to revisit Grayscale’s application, leading to potential developments in the cryptocurrency market.
Final thoughts
While the initial excitement over the supposed approval of a spot bitcoin ETF turned out to be unfounded, the events on Monday demonstrated the high level of anticipation regarding the regulator’s impending decisions, and the potential market impact of these decisions.
I have been a full-time professional writer for over 10 years, and have written for some of the biggest publications in the world. My work revolves around cryptocurrencies and blockchain technology, and I am widely considered to be one of the leading experts in these fields.I have written two books on the subject matter, and my articles have been featured in major news outlets such as The Wall Street Journal, Forbes, and Huffington Post. In addition to writing, I also give talks and seminars on cryptocurrency investing, and am a regular commentator on CNBC, Bloomberg, and other financial news networks.
