Bears brutally slaughtered, Bitcoin returns overnight? Repeatedly adding and deleting BlackRock ETF information, DTCC is questioned for manipulating the market

Reported by Zhao Yihu Jinhua, a journalist from China Times. net. cn in Shanghai

Is the Carnival in the Coin Circle Starting Again?

On October 24th, Bloomberg ETF analyst Eric Balchunas posted that asset management giant BlackRock's iShares Bitcoin spot ETF has been listed on the US Securities Depository and Clearing Corporation (DTCC) under the stock code IBTC.

As soon as the news came out, the encryption market stirred up. Bitcoin briefly exceeded $35000 and briefly rose to $35919, with a daily maximum increase of nearly 20%. This is also the first time since 2023 that Bitcoin has exceeded $35000. Ethereum also exceeded $1800.

However, this also led to the short selling of Bitcoin being completely slaughtered in a short period of time. CoinGlass statistics show that over $150 million of short positions were sold out in about an hour, of which over 80% were short positions, and over two-thirds were concentrated on Bitcoin. In addition, within just 2 hours, the market cleared approximately $1 billion of Bitcoin open positions, which is also the largest short liquidation event so far this year.

However, it is worth noting that while Bitcoin prices were soaring, DTCC briefly deleted the information on BlackRock's "IBTC" and then added it back, causing a market uproar. As of press release, the latest price of Bitcoin has dropped to $34037.49, a decrease of 1.59% within 24 hours. Ethereum is currently trading at $1793.7, a decrease of 2.2% within 24 hours.

It's just standard practice

On the evening of October 24th, investors discovered that BlackRock's "IBTC" had disappeared from the list updated by DTCC. Subsequently, investors discovered that the DTCC official website was down and the page could not be opened. In just one hour, the entire crypto market had a net exposure of $47.5109 million, including multiple exposure of $41.3639 million and short exposure of $6.147 million. The crypto community has also been arguing about this, believing that DTCC is manipulating the market.

As of press release, iShares Bitcoin spot ETFs, a subsidiary of asset management giant BlackRock, have been redisplayed on the DTCC website list.

Faced with market doubts, DTCC stated on October 25th that in August 2023, the BlackRock Bitcoin Trust ETF was added to the qualification documents, and its appearance on the list does not indicate an indication of any unresolved regulatory or other approval results. It is standard practice to add securities to the NSCC securities qualification documents in order to launch new ETFs into the market.

It is worth noting that as of now, BlackRock has not commented on this matter.

According to analyst Eric Balchunas, BlackRock's iShares listing on DTCC is "part of the entire process" of bringing encrypted ETFs to the market. The stock code of iShares spot Bitcoin ETF is IBTC, which may be listed on the Nasdaq Stock Exchange. The investment vehicle applied for listing and trading in June.

This is the first spot ETF to be listed on DTCC, and there are currently no other exchanges listed, "Balchunas said. BlackRock is clearly promoting these matters related to the pre IPO process (seed funds, stock codes, DTCC, etc.). It is difficult not to see this as a clear signal of approval or an upcoming signal.

According to public sources, DTCC (Depository Trust&Clearing Corporation) is a US financial services company established in 1999. The company consists of five clearing houses and one depository institution, providing clearing and settlement services to the financial market. For a long time, the listing of financial products on DTCC has been a crucial step in the process of pushing them to the market.

According to the S-1 amendment submitted earlier by BlackRock, BlackRock has obtained the CUSIP (Unified Securities Identification Number) prepared for the release of Bitcoin spot ETFs. BlackRock is also preparing Seed Capital for Bitcoin spot ETFs, which will be used as the underlying asset purchased by the issuing company at the time of ETF launch to meet future demand for the product.

Various signals seem to suggest that spot ETFs in the crypto market are about to be approved. However, the fact is that 8 large US financial institutions have submitted Bitcoin ETF applications to the SEC within the year, but all have been rejected by regulatory authorities.

Paul Brody, the head of global blockchain at Ernst&Young, stated that due to years of non approval of spot Bitcoin ETFs by US regulatory agencies, Bitcoin faces a large amount of pent up demand from institutions. Once the Bitcoin ETF is approved, trillions of dollars of institutional funds are waiting to enter the Bitcoin market.

Wu Gaobin, Vice Chairman of the Integration Committee of China Communications Industry Association and China Communications Industry Association, told reporters from China Times that the approval of Bitcoin spot ETFs means that investors can now participate in Bitcoin trading through traditional financial markets. ETF is an investment tool that allows investors to purchase and hold Bitcoin in the form of stocks, without the need to truly own and manage cryptocurrency wallets. This will provide convenience and security for more institutions and individuals to participate in the encryption market, further promoting the development of the encryption industry.

The passing of Bitcoin spot ETFs will also bring more liquidity and capital inflows to the encryption industry, "said Wu Gaobin. Participants in traditional financial markets will have the opportunity to invest in Bitcoin, which will increase market activity and trading volume. At the same time, the introduction of ETFs will also attract more funds to flow into the crypto market, providing more financial support for project development and innovation. This will further consolidate Bitcoin's position as one of the most important cryptocurrencies in the world.

The volatility of the cryptocurrency market is high, and prices may experience significant fluctuations. Investors should be prepared for this and develop corresponding risk management strategies. In addition, the price of ETFs may differ from the actual price of Bitcoin, depending on the supply and demand relationship in the market and the premium situation on the exchange. Therefore, investors need to carefully study and understand the operating mechanism of ETFs, and make decisions based on their investment goals and risk tolerance Make a decision Wu Gaobin said.

There are also new developments in grayscale

In addition to BlackRock receiving much attention, grayscale has also made progress in Bitcoin spot ETFs. Recently, the Washington D.C. Circuit Court of Appeals in the United States has officially ruled on the lawsuit between Grayscale and the SEC, and the SEC needs to reconsider its application to convert Grayscale GBTC into Bitcoin spot ETFs.

According to publicly available court documents, the Washington D.C. Court of Appeals has officially ruled on the lawsuit between Grayscale and the SEC, upholding its August ruling that the Securities and Exchange Commission needs to reconsider Grayscale Investments' application to convert its flagship GBTC fund into a spot Bitcoin ETF. The court did not issue any additional instructions to the SEC, and the ruling has officially come into effect, which means that the SEC needs to re-examine the conversion application of grayscale to spot Bitcoin ETFs.

Grayscale stated in a statement that GBTC intends to list on NYSEArca under the code GBTC, and will continue to issue shares after the approval of the stock listing application on NYSEArca Form 19b-4 and the validity of the registered shares on Form S-3.

According to regulatory documents released by ETFStor Chairman Nate Geraci, the SEC has accepted the filing of grayscale spot Ethereum ETFs, which will be the process of converting ETHE into ETFs. Previously, Michael Sonnenshein, CEO of Grayscale, stated on social media that Grayscale has applied to convert Grayscale Ethereum Trust into Ethereum spot ETFs.

Although the crypto market is immersed in the illusion of the imminent passage of Bitcoin spot ETFs, the other end of the crypto market is still plagued by crises. Recently, ParityTechnologies, a Poka development organization, was exposed to have laid off over 300 employees. The organization later denied this, but its latest official layoff data still exceeds 100.

Meanwhile, according to the third quarter production report of Bitcoin released by HashrateIndex, the prices of Bitcoin ASIC production machines continued to decline in 2023, and all specifications of survival machine models hit historic lows in the third quarter. At the same time, Bitcoin's overall computing power scale and production difficulty have repeatedly reached new highs.

It is worth noting that since the beginning of this year, Bitcoin spot ETFs have repeatedly driven Bitcoin prices to rebound. In June of this year, after BlackRock and Fidelity Investment resubmitted their spot Bitcoin ETF applications, the Bitcoin trading price briefly exceeded $30000. On the evening of October 16th a week ago, a fake news report falsely claiming that "BlackRock Bitcoin spot ETF has been approved" also caused the price of Bitcoin to briefly exceed $30000. However, after refuting the rumor, Bitcoin prices quickly dropped below $28000.

In response, Yu Fenghui, a specially invited researcher from a Chinese financial think tank, told reporters from China Times that the approval of Bitcoin spot ETFs has a significant impact on market conditions because it provides investors with an easier and more reliable way to participate in the Bitcoin market. Approval means that more institutional and individual investors can buy and sell Bitcoin using traditional stock and ETF accounts, without the need to purchase and save the actual Bitcoin themselves. This will further drive the liquidity and widespread market participation of Bitcoin, which may lead to an increase in Bitcoin prices.

In Yu Fenghui's view, the adoption of Bitcoin spot ETFs will enhance the legitimacy and recognition of cryptocurrencies, allowing more institutions and traditional investors to enter the market. In addition, ETFs provide investors with a reliable and regulated investment tool, which relatively reduces risk. This may further increase investors' interest and demand for cryptocurrencies.

Although Bitcoin spot ETFs are listed on the Nasdaq Stock Exchange, the price of Bitcoin itself remains highly volatile and unstable, "Yu Fenghui emphasized.

Chen Gen, a member of the Central Science and Technology Committee of the Jiusan Society, also told reporters from the China Times that the launch of Bitcoin spot ETFs is a short-term benefit for Bitcoin, mainly due to increased trading liquidity. However, in the long run, cryptocurrencies still need to find their value attributes or be included in the asset regulatory system, otherwise there will still be significant investment risks for ordinary investors.

The risk of investing in Bitcoin's spot ETFs is the same as investing directly in Bitcoin. For ordinary investors, especially in the current international environment with increasing uncertainty and the challenge of quantum computing faced by encryption technology, the risks and uncertainties of investment are increasing and need to be faced with caution, "Chen Gen said.

Editor in charge: Xu Yunqian Editor in chief: Gong Peijia