Bitcoin’s Wild Ride: BlackRock ETF Speculation Triggers Market Frenzy and Sharp Price Swings

Bitcoin’s Wild Ride: BlackRock ETF Speculation Triggers Market Frenzy and Sharp Price Swings

Crypto News – Bitcoin experienced a sudden surge in its price on Monday, only to relinquish most of its gains shortly after. The cause was attributed to a crypto media report claiming that major asset manager BlackRock had obtained approval from U.S. regulators for a cryptocurrency investment product.

Known for its inherent volatility, Bitcoin’s value was trading 3.82% higher at $28,211 at the last check, after a prior increase of as much as 10% to $29,900—the highest it had reached since August.

Initially, crypto news outlet Coin Telegraph reported that the U.S. Securities and Exchange Commission had given the green light to BlackRock’s application for a spot Bitcoin exchange-traded fund (ETF). However, this information was later retracted.

The market saw a sharp downturn in Bitcoin’s value following a statement by a Fox Business reporter on the social media platform X, affirming BlackRock’s denial of the report.

BlackRock later clarified to Reuters that the application for iShares Bitcoin Exchange-Traded Product (ETP) was still under review by the SEC, a fact confirmed by sources close to the SEC.

Ben Laidler, eToro’s Global Markets Strategist, commented on how crypto markets react to potential positive news, citing the premature rally spurred by the rumors of the spot Bitcoin ETF approval. Coin Telegraph issued an apology and retracted their initial post, acknowledging its role in disseminating inaccurate information and committing to transparency through an ongoing internal investigation.

The cryptocurrency market eagerly awaited updates on pending spot Bitcoin ETF applications, anticipating their potential to boost investments in the sector. However, the SEC has consistently denied these applications, citing the lack of demonstrated ability to protect investors from market manipulation.

Joseph Edwards, Head of Research at London-based crypto firm Enigma Securities, highlighted the market’s fixation on the forthcoming spot ETFs. Despite the false alarm regarding the SEC’s approval, experts noted that it served as a valuable dress rehearsal for the market’s response to the regulator’s final decision on the applications.

Lucas Kiely, Chief Investment Officer at Yield App, emphasized the significant impact of headline risk on market volatility, especially in anticipation of the SEC announcement that is expected to profoundly influence the market based on its decision.

On October 13, Reuters first reported that the SEC would not contest a recent court ruling, deeming its prior rejection of Grayscale Investments’ application to create a spot Bitcoin ETF as incorrect. The District of Columbia Court of Appeals is anticipated to issue a mandate in the upcoming week, specifying the execution of its decision, likely instructing the SEC to revisit Grayscale’s application.