Are Coinbase and BlackRock manipulating the Bitcoin price?
Last Updated on 17 September 2024 by CryptoTips.eu
A new conspiracy theory seems to emerge every weekend, but this time one that prompted an immediate response from Coinbase CEO Brian Armstrong, who immediately sought to correct it before the story got too big.
Some Internet users had posted a theory online that showed how BlackRock and Coinbase were in cahoots in recent months to keep the price of Bitcoin under control. Even Bloomberg analyst Eric Balchunas came to the rescue after the theory went viral.
Manipulation
Whenever there are a few large market players who can manipulate the price of a particular commodity, it is natural that smaller players will claim that they are doing so. This of course happened in the past, but the large number of government agencies that control financial markets today makes this very difficult.
Yet it is true that BlackRock, the largest investment fund in the world, and Coinbase, the largest American crypto platform, are buying up big chunks of Bitcoin since the beginning of this year and the launch of the Bitcoin ETFs.
Eric Balchunas, the famous Bloomberg crypto analyst, recently calculated that the American boomers will become the largest Bitcoin Hodlers as from next year due to their investments in the various Bitcoin ETFs.
https://t.co/i7YH90vm0V pic.twitter.com/7oNVWz4FSW
— Tyler (@TylerDurden) September 14, 2024
Theory
The conspiracy theory that went viral goes like this: BlackRock waits until Bitcoin reaches $70k, then takes massive shorts until the price drops to $50k, at which point it starts buying again. Coinbase, which participates in BlackRock’s Bitcoin ETFs, participates and both companies thus manipulate the market.
Coinbase CEO Brian Armstrong saw the story quickly go viral and responded to the posters, claiming it was rubbish.
Baldilocks here.
— Brian Armstrong (@brian_armstrong) September 14, 2024
Not sure what this is all about TBH. All ETF mints and burns we process are ultimately settled onchain. Institutional clients have trade financing and OTC options before trades are settled onchain. This is the norm for all our institutional clients. All funds…
Eric Balchunas, the well-known crypto analyst from Bloomberg, also weighed in, saying that Bitcoin is simply too big to be influenced by two players.
I get why these theories exist and ppl want to scepegoat the ETFs. Bc it is too unthinkable that the native HODLers could be the sellers. But they are. The call is coming from inside the house. All the ETFs and BlackRock have done is save btc’s price from the abyss repeatedly.
— Eric Balchunas (@EricBalchunas) September 14, 2024
According to Eric, it’s just the smaller market players taking their profits every time Bitcoin hits $70k and that’s why crypto has been moving quite sideways over the last few months.