Cryptocurrency investors witnessed a surge and subsequent retracement in Ripple‘s XRP token value, triggered by the circulation of misleading information regarding BlackRock’s involvement in a spot Bitcoin ETF.
In a whirlwind of market activity, Ripple’s XRP token encountered a rapid 12% surge within a brief one-hour window. The catalyst behind this abrupt price movement was misinformation circulating in the crypto sphere, falsely claiming that BlackRock, the world’s largest asset manager, had filed for a spot Bitcoin ETF. The surge was particularly notable as XRP leaped from $0.65 to $0.73 in a mere 25 minutes.
The misinformation originated from reports surrounding a filing submitted to the U.S. Securities and Exchange Commission (SEC) for an entity named the iShares XRP Trust. The documentation purportedly included details such as the name of BlackRock’s managing director, Daniel Schwieger, and the company’s address. The speculative news prompted investors to act without conducting due diligence, resulting in a rush to invest in XRP.
BlackRock ETF hoax sparks crypto turmoil
However, the situation quickly unraveled as Eric Balchunas, an ETF analyst at Bloomberg, promptly discredited the news. Balchunas, after consulting with a BlackRock representative, took to Twitter to clarify the situation, stating, “This is false! Some whacko must have added using BlackRock executive name etc.” Consequently, XRP retraced its gains, plummeting back below $0.66 within 25 minutes of reaching its local peak. As of the latest update, XRP continues to trade around this level.
This incident is the latest episode in the ongoing hype surrounding Exchange-Traded Funds (ETFs) in the digital asset markets. BlackRock initially stoked excitement in June when it filed for a spot Bitcoin ETF, triggering a wave of similar applications from competing asset managers. Unlike existing crypto futures ETFs, a spot ETF would directly invest in and hold Bitcoin on behalf of investors, potentially influencing bullish sentiment through increased demand.
This episode mirrors a similar occurrence last month when Bitcoin experienced a sudden 6% rally within one hour. The surge was in response to a false report by Cointelegraph claiming that BlackRock’s Bitcoin ETF had been approved. These instances underscore the heightened expectations and market sensitivity surrounding the prospect of cryptocurrency ETFs.
Adding to the intrigue, observers noted that BlackRock had recently registered an entity called the iShares Ethereum Trust. This move echoes BlackRock’s establishment of the iShares Bitcoin Trust a week before filing for its Bitcoin ETF. The news of BlackRock’s potential involvement in Ethereum led to a swift 12% increase in Ethereum’s value within a single day.
