The cryptocurrency realm is abuzz with speculations after a tweet from a prominent influencer, EllioTrades, posited that Blackrock could be intentionally manipulating Bitcoin prices ahead of the launch of their ETF.
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Manipulation for Market Share and AUM
EllioTrades tweeted
“The theory that Blackrock is intentionally crashing Bitcoin before their ETF goes live is both fun to think about and makes sense.”
He expounded that launching the ETF at the lowest possible price is beneficial for a firm like Blackrock, whose primary goal is maximizing market share and Assets Under Management (AUM). This strategy would ensure their clients obtain optimal entry points into the market, leading to better gains and, consequently, more deposits.
On the flip side, if Blackrock launched the ETF post a Bitcoin surge, there’s a risk that their clients might face losses if the market were to retract. Such a scenario would increase the likelihood of client withdrawals.
ZuneNFT, in agreement with EllioTrades, noted that Wall Street’s power players are no strangers to market manipulation for their benefit. “Wall Street for sure wants to get their bags loaded. No way they send it without being positioned well at lower prices,” Zune tweeted.
The Bitcoin market cap, currently at around $600 billion, arguably offers a smaller and more manipulable playground than giants like NVIDIA. When juxtaposed with traditional securities, the relatively nascent nature of the cryptocurrency market also makes it more susceptible to swings based on media campaigns and strategic investments.
A Two-Step Manipulative Approach?
Negative Media Blitz: One proposed strategy might be to unleash a negative media campaign to justify a drop in Bitcoin prices. Such an orchestrated move could lead to market panic, prompting traders to sell their holdings.
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Show more +Buying at the Dip: With prices tanked, and numerous accounts liquidated, these players could, theoretically, amass significant portions of Bitcoin at lower prices. For instance, buying up to 5% of the Bitcoin supply would give them substantial market influence.
Post-acquisition, a sudden positive media blitz could help recover and propel the market to new heights, ensuring that the rich clients recover their investments and make hefty profits.
Such a maneuver with Bitcoin could set a precedent. If successful, the same playbook could be used for other digital assets like Ethereum. A positive outcome with the Bitcoin ETF could justify an Ethereum spot ETF, potentially opening the gates for further market manipulations.
While this is all speculative, it underscores the need for vigilant regulatory frameworks to ensure fair play in the growing cryptocurrency sector.
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