The Nov. 13 XRP (XRP) price action stemming from a falsified BlackRock XRP trust filing shouldn’t sway the United States securities regulator’s decision to approve or delay spot Bitcoin (BTC) exchange-traded funds (ETFs) — but it isn’t a good look, say industry observers.
The Securities and Exchange Commission has previously claimed the Bitcoin market can be manipulated and has knocked back spot Bitcoin ETFs, citing a lack of market manipulation controls.
Bloomberg ETF analyst Eric Balchunas told Cointelegraph the fake XRP filing should have little to no impact on the SEC’s final decision.
“We doubt this will impact the situation with spot Bitcoin ETFs,” Balchunas said. However, he added the incident could validate the SEC’s beliefs.
“There’s no doubt it is a bad look that arguably validates the ‘fraud and manipulation’ that the SEC used as grounds for past denial.”
The Nov. 13 filing on the Delaware list of corporations website showed BlackRock creating the “iShares XRP Trust” — a precursor to launching an ETF.
The filing resulted in XRP spiking 12.3% in 30 minutes before it tumbled back down just as quickly once the filing was outed as a hoax by Balchunas and others who received BlackRock’s confirmation that the filing was made by someone posing as its managing director Daniel Schwieger.
Michael Bacina, a partner at the law firm Piper Alderman and chair of the industry group Blockchain Australia, told Cointelegraph he would be “surprised” if the SEC used the incident to postpone ETF applications.
“It’s unlikely an isolated rumor such as this would provide a legal basis for delaying ETF applications already being considered, particularly where they are already subject to deadlines,” he said.
The amount of lying, rumormongering and brazen attempts at market manipulation wrt to #Bitcoin, $XRP, $ETH, $SOL and more as if pertains to ETF news is enough to deny all applications currently pending.
This isn’t a real market. It is fraud flea market. The SEC should hammer it.
Lucas Kiely, the CEO of wealth management platform Yield App, said the faked XRP filing wouldn’t sway the SEC and stressed the crypto community should “calm down.”
“It is highly unlikely that this incident will play any role in that decision,” Kiely sa.
He iterated that many X (formerly Twitter) pundits have posted fear-mongering headlines to capture audience attention and “spoof the markets.”
“Overall, this is a keep-calm and carry-on moment for the industry and likely a mild amusement for BlackRock.”
XRP filing ‘could easily undermine’ ETF efforts
The SEC has rejected several spot Bitcoin ETFs in the past on claims that investors aren’t protected from “fraudulent and manipulative acts and practices,” argues James Edwards, a crypto analyst at Australian fintech firm Finder.
There’s no reason to suggest it will detract from that view, Edwards claimed.
“Unfortunately, events like these could easily undermine efforts to launch a Bitcoin ETF in the U.S.,” Edwards said.
“The onus will be on ETF applicants like BlackRock to demonstrate that they are somehow able to protect clients from market manipulation and fraud, which is difficult given the opaque nature of crypto markets.”
The fake XRP trust filing will be referred to the Delaware Department of Justice for further investigation.
LATEST ON FAKE XRP ETF FILING: “Our only comment is that this matter has been referred to the Delaware Department of Justice,” the spokesperson (for Delaware Dept of State) said. Damn. Someone out there is crapping their pants as we speak.. https://t.co/Xea226Q1vT
According to the US Department of Justice, Wolf Capital’s co-founder has pleaded guilty to wire fraud conspiracy for luring 2,800 crypto investors into a Ponzi scheme.
Making Britain better off will be “at the forefront of the chancellor’s mind” during her visit to China, the Treasury has said amid controversy over the trip.
Rachel Reeves flew out on Friday after ignoring calls from opposition parties to cancel the long-planned venture because of market turmoil at home.
The past week has seen a drop in the pound and an increase in government borrowing costs, which has fuelled speculation of more spending cuts or tax rises.
The Tories have accused the chancellor of having “fled to China” rather than explain how she will fix the UK’s flatlining economy, while the Liberal Democrats say she should stay in Britain and announce a “plan B” to address market volatility.
However, Ms Reeves has rejected calls to cancel the visit, writing in The Times on Friday night that choosing not to engage with China is “no choice at all”.
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On Friday, Culture Secretary Lisa Nandy defended the trip, telling Sky News that the climbing cost of government borrowing was a “global trend” that had affected many countries, “most notably the United States”.
“We are still on track to be the fastest growing economy, according to the OECD [Organisation for Economic Co-operation and Development] in Europe,” she told Anna Jones on Sky News Breakfast.
“China is the second-largest economy, and what China does has the biggest impact on people from Stockton to Sunderland, right across the UK, and it’s absolutely essential that we have a relationship with them.”
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10:32
Nandy defends Reeves’ trip to China
However, former prime minister Boris Johnson said Ms Reeves had “been rumbled” and said she should “make her way to HR and collect her P45 – or stay in China”.
While in the country’s capital, Ms Reeves will also visit British bike brand Brompton’s flagship store, which relies heavily on exports to China, before heading to Shanghai for talks with representatives across British and Chinese businesses.
It is the first UK-China Economic and Financial Dialogue (EFD) since 2019, building on the Labour government’s plan for a “pragmatic” policy with the world’s second-largest economy.
Sir Keir Starmer was the first British prime minister to meet with China’s President Xi Jinping in six years at the G20 summit in Brazil last autumn.
Relations between the UK and China have become strained over the last decade as the Conservative government spoke out against human rights abuses and concerns grew over national security risks.
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2:45
How much do we trade with China?
Navigating this has proved tricky given China is the UK’s fourth largest single trading partner, with a trade relationship worth almost £113bn and exports to China supporting over 455,000 jobs in the UK in 2020, according to the government.
During the Tories’ 14 years in office, the approach varied dramatically from the “golden era” under David Cameron to hawkish aggression under Liz Truss, while Rishi Sunak vowed to be “robust” but resisted pressure from his own party to brand China a threat.
The Treasury said a stable relationship with China would support economic growth and that “making working people across Britain secure and better off is at the forefront of the chancellor’s mind”.
Ahead of her visit, Ms Reeves said: “By finding common ground on trade and investment, while being candid about our differences and upholding national security as the first duty of this government, we can build a long-term economic relationship with China that works in the national interest.”