Fake news release takes Bitcoin Cash for 12-minute joyride
By Gregory Boyd
18:31, 5 November 2021
If it was a scam, it may have taken days or weeks to set it up.
Or it may have been an elaborate joke.
If it was a fraud, the payoff took just 12 minutes.
At 07:30 EDT (UTC -4) on Friday, PRNewswire issued a news release on behalf of Kroger saying the US retailer would start accepting the Bitcoin Cash cryptocurrency (BCH) on 1 December. An automated web widget placed the same release on Kroger’s own company news page.
This was good news for BCH. Trading volume, sitting at under 10 units a minute at that time of day, jumped to over 300 units in the first minute and kept rising as some buyers saw an opportunity. (Trading data here is from TradingViews.)
The price rose too, of course. Starting at a narrow range around $602.56 it increased by $7 in the first five minutes and peaked 12 minutes after the news release at $636.04. Hundreds of coins were changing hands per minute then.
As the price hit $636, the tide turned. Sellers started selling and the price descended even more quickly than it rose.
By then over $6m worth of BCH had changed hands. Trading volume over those 12 minutes reached a level that would take 8 hours on an average day.
At 07:55 EDT (UTC -4) the Reuters news agency spoiled the party. A Reuters reporter made contact with a Kroger spokesperson who said the news release was fake. A Reuters story was widely released by 7:55.
The potential take, if it was a scam, was a little over $149,000, based on trading data.
Cision, the parent of PRNewswire, failed to respond to a request for comment on the incident. Kroger also failed to respond to a request for comment.
At 11:39 EDT (UTC -4), more than four hours after the fake news release was published, Kroger said this on Twitter: “ICYMI: This morning a press release was fraudulently issued claiming to be The #Kroger Co. that falsely stated the organization will begin to accept Bitcoin Cash. This communication was fraudulent and is unfounded and should be disregarded.”
Two months ago, a hoax news release reported that retail giant Walmart would begin accepting Litecoin payments. The cryptocurrency gained nearly 30% at its peak that day before falling to 3% below where it started.
Read more: Kroger reports strong second quarter, raises 2021 guidance
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