Misinformation is not new in the crypto market. But, when it happens, it wipes out a large amount of money.
A false report claiming BlackRock’s approval of a Bitcoin ETF, sent shockwaves through the market, resulting in a loss of over $65 million.
Bitcoin’s price soared from a stable $27,900 to nearly $30,000, all driven by the exciting, albeit misleading, reports.
The aftermath was brutal. Bitcoin’s value dropped to around $28,000. Traders who had ridden the wave of optimism found themselves facing the reality of liquidation.
Data from Coinglass revealed that this short crypto rally’s reversal led to a total liquidation of $71.36 million.
Furthermore, the financial fallout from the false BlackRock news amounted to the loss of around $114.7 million.
Lookonchain’s data shed light on the buying and selling during this period. One example involved a whale who invested in 20.5 WBTC, parting with 613,201 USDC.
Yet, within ten minutes, this venture was sold at a loss of $49k. Such instances shows the gravity of decisions and the risks of succumbing to the Fear of Missing Out (FOMO).
In a space where fortunes hang in the balance due to a tweet or rumors, traders must proceed cautiously.