Perhaps this is a fake news that can go down in history.

On October 16th, according to Cointelegraph, the US Securities and Exchange Commission has approved BlackRock's iShares Bitcoin Spot ETF.

"Bitcoin", "ETF", "APPROVE" - when these three highly anticipated words are finally combined, it's hard to believe that it's actually a $100 million fake news.

20 minutes, liquidation of 100 million US dollars

As the most anticipated development in the global cryptocurrency market, the movements of Bitcoin ETF product are extremely controlling over this already fragile market. Do you remember a few months ago when Bitcoin's rise above $30,000 was due to the market's expectation of ETF, and when the news of the delay came, the market immediately fell in response.

Two hours ago, the same thing happened again. The news of the SEC's approval of the Bitcoin ETF was released by the veteran cryptocurrency media Cointelegraph in all capital letters on social media, and the market immediately reacted. The market value of Bitcoin, which is worth $550 billion, broke through multiple integer positions and reached $30,000. The bull market is back. In less than half an hour, the reading volume of this tweet reached nearly 1.5 million. It's hard to imagine that there are still so many people in the crypto industry.

But soon the market realized something was wrong, because heavyweight news like the Bitcoin ETF, Bloomberg and other mainstream media did not report any content. Soon, Bloomberg ETF analyst James Seyffart claimed on social media that the news was suspected to be fake news, and currently there is no evidence to confirm this.

Subsequently, multiple sources came forward to refute the rumors. Bloomberg Terminal information showed that BlackRock stated its Bitcoin spot ETF application is still under SEC review. Cointelegraph has also deleted the false news tweet previously published.

While there was a widespread debunking, Bitcoin rebounded above $27,000, ending the approximately 10-minute climax.

10 minutes, nearly $100 million was spent in the market for this false news of just 7 words, with short positions liquidated for $72 million and long positions liquidated for $26 million. It seems like there were no winners.

Crypto has never lacked false news, or it can be said that it is one of the industries with the most false news in the world, after all, it is directly related to money. We often see simple or complex false news such as "a founder was killed by the police" or "a project received investment from a top VC". But even with so many false information, the impact on the industry is controllable and far less than the impact of false news like "old media using a serious news style with only 7 words to tell us an eagerly awaited event", which greatly undermines the industry's confidence.

Can only guess, Cointelegraph seems to really believe that this is true, and they have no reason to do anything harmful to their own industry.

Because Bitcoin ETF is too crucial for us now.

Bitcoin ETF's significance to the industry

Once the Bitcoin spot ETF is officially listed in the United States, it will become a milestone event in the global blockchain industry, as this means that the US regulatory authorities have legally recognized Bitcoin as a financial product, and Bitcoin will gain unprecedented influence.

The CEO of Coinbase, Brian Armstrong, once talked about Bitcoin spot ETF in an interview, stating that ETFs may bring benefits to Coinbase and also become a new source of capital for the cryptocurrency ecosystem. Here is the link to the interview.

Based on this, multiple Bitcoin ETF applications have been rejected by the SEC, but they will still resubmit their applications and tirelessly update them in response to the SEC's requirements. Bloomberg senior ETF analyst Balchunas said that although approval may not come immediately, the back-and-forth communication between the SEC and the project team is a very positive signal.

Ark Investment Management and 21Shares have collaborated to launch the ARK 21Shares BTC ETF, which has been seeking approval since 2021. This year, including BlackRock, 8 large financial institutions have submitted Bitcoin ETF applications to the US SEC.

Bitwise's application for a Bitcoin ETF is only one day apart from BlackRock's application, and despite being rejected by the SEC earlier due to fraud and manipulation issues, Bitwise remains steadfast. Following suit, WisdomTree also resubmitted its application for the WisdomTree BTC Trust.

Although their two applications were unsuccessful, they still hope to let investors understand the price trend of BTC. Finally, Fidelity Investments also joined the ranks of BTC ETF.

According to data, as of October 16th, there are at least 11 ETF applications related to Ethereum waiting for regulatory approval, and these companies have not withdrawn their applications. After the SEC begins its review, it has a total of 240 days to make a decision on the application, and the first deadline for the next batch of ETF applications is October 17th, when Bitcoin ETFs will face intensive approval.

It is expected that the SEC will respond to the Bitcoin ETF application files submitted by Bitwise, BlackRock, VanEck, WisdomTree, and Invesco on October 17th. Bitwise's application will be reviewed before Friday, and the other applications will be reviewed the following day, so the SEC may weigh in before the weekend. Meanwhile, responses were made to Valkyrie and Globle X on September 4th and October 10th, respectively.

现货 EFT 的长期拉锯

Long-term tug-of-war of spot EFT

When it comes to Bitcoin ETF applications, it is necessary to mention Grayscale. Since October 2020, Grayscale has planned to apply for the conversion of its BTC trust into an exchange-traded fund (ETF), but the SEC has rejected it for various reasons during these three years.

GrayScale decided to formally file a lawsuit against the SEC one year ago, and thus began a legal battle that lasted over a year. On the evening of August 30th this year, GrayScale won the lawsuit and overturned the SEC's decision to block the GrayScale ETF.

Related reading: "Grayscale wins SEC lawsuit, is there new hope for the DCG empire behind GBTC?"

Due to the complexity of compliance and trading, institutional investors find it difficult to hold BTC directly, while for individual investors, there is a certain learning curve for trading and storing cryptocurrencies. Grayscale Investment Management's Bitcoin Trust Fund GBTC largely helps to solve this problem. Therefore, many institutions participate in the premium arbitrage movement through the product structure of GBTC.

GBTC tracks the price of Bitcoin but is not completely consistent, and its premium rate has always been an important indicator in the cryptocurrency market. Before the cryptocurrency market turned bearish, the negative premium trend of GBTC seemed irreversible. In order to convert the trust into a spot Bitcoin ETF and correct the "discount" of GBTC, Grayscale has been pushing for the conversion of GBTC into a Bitcoin spot ETF, but all three applications have been mercilessly rejected by the SEC.

On September 3rd, a research report by Morgan Stanley analysts led by Nikolaos Panigirtzoglou showed that Grayscale's recent victory suggests that the SEC may be forced to approve various Bitcoin spot ETF applications from asset management companies, including Grayscale, that have been pending.

On October 14th, Bloomberg ETF analysts Eric Balchunas and James Seyffart posted on social media that Ark and 21Shares (Invesco Galaxy has also updated) recently updated the prospectus for their physical Bitcoin ETF, adding at least five new pages of text. The post was made in Chinese.

This indicates a constructive dialogue with the SEC, which typically only occurs when an ETF is about to be approved. We believe there is a 90% chance that a physically-backed Bitcoin ETF will be approved before Ark's January 10th application deadline.

According to Fox Business reporter Eleanor Terrett on October 16th, Grayscale issued a statement regarding the decision of the US SEC not to appeal, stating that "the 45-day deadline for seeking a rehearing under the Federal Appeals Procedure Rules has passed. The court will issue a final authorization within 7 days. The Grayscale team is ready to convert GBTC to ETF once approved by the SEC."

On the same day, according to sources cited by Reuters, the US SEC does not plan to appeal the court's ruling in the "Grayscale's application to convert GBTC to a spot ETF" case, and this decision may pave the way for the SEC to review Grayscale's Bitcoin spot ETF application. The report was released.

But no matter how far away the ETF is from passing, it seems that we can see from tonight's extreme price performance that the market may be ready to welcome the spot ETF and start the next bull market.

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