Nov 14

Fraudulent Registration in BlackRock Fund Triggers Brief Surge in XRP Cryptocurrency

An application for the creation of a BlackRock Inc. fund based on the XRP cryptocurrency appeared on the official website of the state of Delaware, which registers investment funds incorporated in the state. This triggered a short-lived surge in the token's value. However, the sole problem is that the application was not submitted by BlackRock.

Details of the so-called "iShares XRP Trust," registered under BlackRock on Monday, were listed on the Delaware State Department's Division of Corporations website, which also lists some other trust funds for which asset managers had previously filed applications. However, a representative of the asset management company confirmed that this information is false.

XRP briefly jumped nearly 13% when news of the fraudulent documentation spread across X, formerly known as Twitter, reclaiming the profit lost due to price declines earlier in the day.

The XRP token is one of the largest cryptocurrencies, ranking fifth on the CoinGecko website, although it is less known than Bitcoin and Ethereum.

A representative of the Delaware State Department did not respond to requests for comment. It was not immediately clear how false information about BlackRock ended up on the website.

This appears to be the latest instance of false news spreading quickly on the internet within the crypto community, where excitement is growing about the possibility that U.S. regulators may soon approve an exchange-traded fund (ETF) that would directly hold bitcoins.

The prospect of this development has been hyped by many traders and has become a major factor influencing the recent rally in Bitcoin, rising to around $37,000 from approximately $25,000 in mid-June.

Deceptions have real consequences: token prices tend to move rapidly with any gradual changes regarding potential crypto-centric ETFs and usually lose gains as quickly as they accumulate. A recent false tweet claiming that the U.S. Securities and Exchange Commission had approved the creation of a Bitcoin fund led to a sharp price increase before it was debunked.

Last week, BlackRock filed an application to create a fund based on Ether, and the documents appeared on the same Delaware State website as the Monday application. This was legitimate and helped boost the price of Ether, the second-largest token. The name of the same BlackRock contact was listed in both the legitimate Ether filing and the fake XRP applications on Monday.

"This is not the best look for the crypto industry and definitely undermines trust in good players in this space, but it was quickly seen as a fake," said Bloomberg Intelligence analyst James Seyffart. "Last week we saw a similar event that turned out to be real for the Ethereum trust, but filing for an XRP ETF currently seems a bit stretched."
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