Ripple Rallies 12% And Back In One Hour On Fake ETF News

Misleading corporate filing ignites short-lived rally

By: Samuel Haig Loading...

Ripple Rallies 12% And Back In One Hour On Fake ETF News

Ripple’s XRP token surged 12% before giving up all of its gains in roughly one hour after the circulation of fake news claiming that BlackRock, the world’s largest asset manager, had filed for a spot Bitcoin ETF.

On Nov. 13, several crypto news outlets reported on a filing submitted with the U.S. Securities and Exchange for an entity called the iShares XRP Trust. The documentation included the name of BlackRock managing director, Daniel Schwieger, and BlackRock’s address. XRP rocketed 12% from $0.65 to $0.73 in 25 minutes as investors forewent due diligence and rushed to ape into XRP.

However, the news was quickly discredited by Eric Balchunas, an ETF analyst at Bloomberg, after he spoke to a BlackRock representative. “This is false!” Balchunas tweeted. “Some whacko must have added using BlackRock executive name etc.”

XRP crashed back below $0.66 within 25 minutes of posting its local top, and is still trading around that level as of this writing.

XRP/USD, 24-hour price chart. Source: CoinGecko

The incident is the latest manifestation of the ETF hype currently capturing the digital asset markets.

BlackRock kicked off the excitement in June by filing for a spot Bitcoin exchange-traded fund, prompting a spate of applications from rival asset managers. A spot ETF would invest in and hold Bitcoin on behalf of investors, exerting bullish pressure on the asset’s supply — unlike existing crypto futures ETFs, which invest in derivatives.

Bitcoin abruptly rallied 6% in one hour last month when Cointelegraph falsely reported BlackRock’s Bitcoin ETF had been reported, illustrating investors’ bullish expectations for the product.

Sleuths also spotted that BlackRock had registered an entity called the iShares Ethereum Trust earlier this week, reminiscent of the iShares Bitcoin Trust established by BlackRock a week before its Bitcoin ETF filing. ETH jumped 12% in one day in response to the news.

XRP rally

Ripple is still riding high despite the fake news-inspired rally, having gained 35% in the past four weeks.

XRP’s price action picked up after the U.S. Securities and Exchange Commission dropped its 2020 lawsuit against Ripple alleging the sale of unlicensed securities. Both parties agreed to the case’s dismissal with prejudice, and will negotiate penalties for $729M worth of sales deemed to violate securities law.

The agreement followed a U.S. judge ruling that XRP is not a security in July, with the court noting that an asset does not automatically comprise a security even if it is sold via a securities contract.