False Bitcoin ETF Report Rockets Price Before Reality Strikes

Bitcoin price moved erratically following fake news that iShares Bitcoin spot ETF had been approved.

Guy in the sky jumping over Bitcoin.
Created by Kornelija Poderskytė from DailyCoin
  • Bitcoin experienced a short-lived moment close to the $30K breakpoint.
  • The sharp gain was driven by fake news.
  • Users have lost money in FOMO.

Crypto users were treated to ephemeral joys on October 16 following fake news that the U.S. securities regulator had approved a Bitcoin Spot ETF.

In a now-deleted tweet, media outlet Cointelegraph alleged that the Securities and Exchange Commission (SEC) had approved the Bitcoin spot ETF application for iShares, a report that verifiable sources couldn’t substantiate.

Bitcoin Price Shoots Momentarily, Liquidations Follow

According to live data by CoinGecko, moments after the fake news spread hastily, Bitcoin’s (BTC) price shot to $29,483 before dropping sharply to $27,918.

What followed next was a liquidation spree to $64.5 million within just one hour.

BTC liquidation heatmap.
Bitcoin Liquidations: Source

Although Cointelegraph edited the tweet a few minutes before deleting it, the damage had already been done.

Adam Cochran, an experienced fintech executive and angel investor, called out the media outlet for what he termed a “blatant scam” and urged the company to provide documentation on where the ETF approval report came from.

The fake news didn’t just affect BTC’s price; it had a ripple effect across the industry, evidenced by how users have lost money.

Users Lose Money in FOMO

Driven by the fear of missing out (FOMO), users have lost a lot of money while trying to capitalize on the “good news,” which seemed like a reprieve after endless months of unprecedented crypto winter.

According to a Twitter (X) update by Lookonchain, one whale lost almost $49,000 in 10 minutes after spending $631,201 in USDC to acquire 20.5 $WBTC, which he quickly sold for 563,970 USDC, probably after realizing that the news was indeed fake.

Read more Bitcoin whale news:
Bitcoin Whale Wallets Pass 2019 All-Time High

Read more about the SEC and Grayscale’s quest for a Bitcoin ETF:
SEC’s Green Light Allows Grayscale’s Quest for Bitcoin ETF

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Brian Danga

Brian Danga, a Kenyan crypto reporter, is dedicated to delivering breaking news and updates from the cryptocurrency world. With a background as a Web3 writer and project manager, he recognizes the importance of unbiased reporting. Holding an LLB degree from the University of Nairobi, Brian's analytical skills contribute to his accurate news reporting. His personal interests include cooking, watching documentaries, reading, and engaging in intellectual discussions.