The native HBAR token of Hedera had a spike of nearly 107% on Tuesday before plunging 25% due to investor speculation that BlackRock was involved in a fund tokenization initiative on the Hedera blockchain.
Hedera said on Tuesday that, in partnership with Archax, BlackRock’s ICS U.S. Treasury money market fund had been tokenized on the Hedera blockchain. Hedera fans started saying on social media that BlackRock selected Hedera to tokenize its fund, even though that was untrue. In response to complaints of Hedera’s deceptive marketing, Archax CEO Graham Rodford stated that “it was indeed an Archax choice to put [the fund] on Hedera.”
BlackRock introduced its USD Institutional Digital Liquidity Fund on Ethereum last month, marking its entry into the real-world asset (RWA) tokenization market.
Even if the HBAR token has gained 61% in the last day, there is still just 2% market depth, with $900,000 in cumulative bids on the Binance and Upbit order books sitting within 2% of the token’s current price of 14 cents. CoinMarketCap reports that the coin has had trading activity of over $2.6 billion in the past 24hours.
The data from CoinGlass indicates that there is a bearish bias as all derivative exchanges have significantly negative financing rates. This implies that those with long positions must compensate those with short ones. On Binance, there are now 0.85 long to short ratios.
Given that open interest has increased by 442% to $160 million in the past 24hours, the weighted short interest and lack of liquidity present the conditions for a volatile trading period that may end in a return to parity or a short squeeze.