Bitcoin Rollercoaster: False SEC Approval Tweet Triggers $50 Million in Liquidations

False Alarm Sends Bitcoin Markets Reeling

The Bitcoin-crazed, unpredictable world took another exciting drop this week and demonstrated the fine line between excitement and reality in the emerging cryptocurrency industry. The world’s leading digital asset touched $47,00 on Tuesday before plunging back to about the same value of over -$ 45,- within hours after a tweet that is now false concerning the Securities and Exchange Commission (SEC) approved an ETF for spot futures trading.

False Alarm Sends Bitcoin Markets Reeling

The catalyst for this sudden decline was a tweet that the SEC has finally approved spot Bitcoin ETF, something investors have been waiting on for years. The tweet spread like fire on social media in minutes, with Bitcoin’s price peaking out into an excited euphoria. However, it did not last long as the SEC and major players in the industry quickly refuted this claim to be false.

See Also:  NFL player Damon Arnette arrested in Miami Beach: report | Fox News

This quick fix shows how susceptible the bitcoin market is to even a small smell of positivism. Without any semi-official spot ETF yet approved, even a rumor or speculation can affect price movements significantly.

Liquidations Cascade, Exposing Leverage Risks

It also led to a wave of liquidations, as traders who had leveraged their positions on the expectations that were based upon dishonest information ended up selling them off to meet margin calls. Data from Coinglass showed that within a few hours, the liquidation of over $50 million in Bitcoin positions also contributed to the downward pressure on its price.

This episode is a stark reminder that leverage brings inherent risks in the crypto market. It can also enhance losses, often resulting in severe financial consequences for traders who are over-leveraged.

See Also:  Stimulus Update 2023: President Biden Proposes Faster Disbursement of Expanded Credits!

Persistent Regulatory Uncertainty Dampens the Long-Term Outlook

Although a false rumor initially caused this volatility the real uncertainty remains as to what stance will be taken by the SEC on spot Bitcoin ETFs. While many issuers have repeatedly applied for approval from the regulatory body, none so far has received such a nod of approval on grounds that market manipulation and investor interests are at stake.

However, this regulatory ambiguity still casts a shadow over the long-term prospects for Bitcoin and other cryptocurrencies. Due to speculation and rumors, volatility in this area is likely to be rampant until the SEC defines a clear path forward.


The recent Bitcoin rollercoaster ride is the perfect example of how precarious a situation hype versus reality can be in the cryptocurrency world. False news can drive price trends, and leverage increases profits and losses. Investors must exercise utmost caution and carefully evaluate the risks involved in the highly dynamic and volatile environment of spot Bitcoin ETFs, given the current regulatory uncertainty.