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Rogue CoinTelegraph ETF Post Prompts $30k BTC
CoinTelegraph's post caused $100 million of liquidations, as BTC spiked and retracted by $2,000 in 20 minutes.
Yesterday, at 13:25 UTC, bitcoin suddenly broke out from the $28,000 resistance level. In the space of just six minutes, it climbed almost $2,000, to $29,900. Less than 20 minutes later, it was back where it started.
The reason? A single post from CoinTelegraph on Twitter/X, stating that the SEC had approved a Bitcoin spot ETF.
The news was taken up across X, and reposted by thousands of accounts. A few lone voices urged caution and asked for sources, but traders weren't paying attention. And, indeed, a handful high profile news outlets were caught up in the hype—apparently including Reuters.
It didn't take long for people to realize that there wasn't any official confirmation of the reports: No press release from the SEC, iShares, or any of the other ETF applicants. CoinTelegraph attempted damage limitation by editing their post, adding a "REPORTEDLY" to the post.
A few minutes later confirmation came, though not of the kind the crypto community had hoped for. It was fake news.
BTC returned to where it started, 20 minutes earlier, putting in possible the ugliest doji candle traders have ever seen and causing $100 million in liquidations.
It was embarrassing for anyone who reposted without checking for official sources, and could be potentially devastating for CoinTelegraph, who removed the post when it became clear what had happened. The news outlet's actions have made and lost traders huge amounts of money.
CoinTelegraph put out an apology, promising an investigation and an update within three hours.
CoinTelegraph did eventually publish an update several hours later, stating, in essence, that one of their employees saw a rumor and posted the "news" without checking its source.
The news lead originated from an unconfirmed screenshot posted by an X user who claimed it was from the Bloomberg Terminal.
That won't be much consolation to the traders who were liquidated, some of whom may be considering legal action against the company. The whole episode won't do the industry any favors, given that one of the SEC's major issues with a spot ETF has been the possibility of market manipulation.
Other users were sanguine, though, pointing out that as a dummy run for the inevitable approval (whenever that might occur), it had been impressive.
If this is how the market reacts to the real thing, traders with open sell orders anywhere close to spot aren't going to have time to cancel them.
Right now, BTC is trading at $28,400 slightly above where is was before the fake news broke.
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