Bitcoin’s price recently surged past $28,000, experiencing significant gains. The world’s leading digital currency reached an intraday high of nearly $28,600 around 6 p.m. EST, but it later dipped to just below $28,300.
Several factors influenced these price movements, with a fake news report being a notable one. A false report from Cointelegraph’s Twitter account claimed that the U.S. Securities and Exchange Commission (SEC) had approved an application for an exchange-traded fund (ETF) by BlackRock, a global asset manager. This news caused a short-term spike in Bitcoin’s price, followed by a quick drop.
Crypto analyst Scott Melker pointed out that Bitcoin was already up about 4% on the day before the fake news broke. He suggested that this initial upward movement might have been driven by insiders who anticipated the news or a short squeeze.
Tim Enneking, the managing director of Digital Capital Management, added that the timing of this news coincided with the SEC’s deadline to appeal the Grayscale decision from earlier in the year. The subsequent short squeeze caused a rapid price spike, which promptly reversed.
Additionally, Armando Aguilar, an independent cryptocurrency analyst, highlighted the impact of other factors. He mentioned a prediction by Bloomberg Intelligence’s ETF research analyst, James Seyffart, who believed there was a 90% chance of approval for an ETF application submitted by ARK Invest by January 10. This optimistic outlook, along with the introduction of new institutional products and investments, has contributed to Bitcoin’s price increase.
Looking ahead, the cryptocurrency market could see significant benefits if the SEC approves a spot Bitcoin ETF application. Andrew Rossow, an attorney and founder of AR Media Consulting, emphasized that the SEC’s approval of such an application would be a game-changer for the crypto market, potentially bringing it one step closer to mainstream adoption.
