Did an April Fools’ joke spark the Bitcoin rally?

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april fools bitcoin

An explosive Bitcoin rally has led to speculation an April Fools’ Day article tricked investors into buying up the digital currency.

Finance Magnates posted the headline ‘SEC drops the bomb: Approves Bitcoin ETFs‘ as a joke on April 1 and the following day we saw a 23 per cent increase in the Bitcoin price.

One observer tweeted: “it was an April Fools’ joke the Chinese didn’t understand.”

Did the article cause the pump?

There is a general consensus the article alone didn’t cause the massive sudden increase in the Bitcoin price.

Mati Greenspan, a senior market analyst at eToro, told Bloomberg said the timing wasn’t quite right.

“That article came out about 18 hours before the pump happened,” Mr Greenspan said.

“I think that everybody kind of understood that it was an April Fool’s joke, so … I don’t think that’s what would have caused such a massive move.”

April Fools Bitcoin
Mati Greenspan, Senior Market Analyst at eToro.

OK. So what caused the Bitcoin pump?

Mr Greenspan says the sharp move has been building up for a few months since the mid-December lows.

“We’ve been gaining some gradual momentum, initially it was in some of the altcoins,” he said.

“We saw a bit of value-investing, where some of those cryptos were surging.

“Some of them have doubled, tripled or even quadrupled in value since then, whereas Bitcoin has been a bit more stable.

“The move this morning seems to be a technical move that was caused by a jump above that $4,200 level.

“This is a key level that’s been eyed by traders for weeks now so no doubt we had a lot of entry orders there.”

Are we seeing Bitcoin adoption?

There are claims the Bitcoin price rise is now a reflection of Bitcoin adoption beginning to occur.

“It is a very big part of the story,” Mr Greenspan said.

“Throughout this crypto winter that we’ve seen over the last year, we’ve actually seen the industry growing at a rapid pace.

“Certainly there have been some companies that went under because they didn’t manage their books right, they were relying on very high crypto prices.

“But that’s what bear markets are all about. That’s when business models are tested.”

“The industry has actually been growing at a rapid pace.”