While the standard of journalism within the cryptocurrency industry leaves much to be desired, over the past few weeks, a wave of false news and misinformation has gained momentum. While the crypto market is used to FUD, these events raise questions about the integrity of reporting within the industry.
Mainstream media’s tendency to bend facts to fit particular narratives, especially when portraying crypto negatively, has been a known issue. However, the escalating problem of misinformation is not restricted to mainstream media outlets, which have grappled with this issue since they turned to online advertising for revenue. People within the cryptocurrency industry are increasingly promoting false and misleading stories.
The journalistic crisis stems from two distinct factors: financial constraints and the race against time. Creating high-quality articles entails extensive research, fact-checking, and adherence to ethical guidelines such as public benefit and providing a right to respond before publication.
Research and planning take time, which costs money. In an era where journalism’s revenue predominantly springs from online advertising, the funds to underwrite such rigorous reporting are in decline.
Added to this is the steady evolution toward a 24-hour news cycle, putting media outlets under relentless pressure to produce content frequently. The result is a perfect storm of hurried content production and reduced journalistic resources.
A case in point occurred this week at the Financial Times (F.T.) in the U.K., a stalwart of global financial journalism. The F.T.’s reputation took a severe hit when an article erroneously reported that the SEC had directed Coinbase to delist every cryptocurrency except Bitcoin.
What exacerbated the situation was the inclusion of direct quotes from Brian Armstrong, CEO of Coinbase. While Mr. Armstrong has not denied making the statements, Coinbase quickly issued a rebuttal, emphasizing that the comments were taken out of context.
Seizing the opportunity to point out their competitor’s error, Reuters wrote, “In response to the F.T. report, a Coinbase spokesperson said the SEC had never shared a position that all assets other than bitcoin were securities and that staff doesn’t make formal requests such as the one implied by the article without a vote of the full commission.”
Additionally, this week, C.Z., CEO of Binance, openly criticized Coindesk’s reporting on an alleged attempt to shutter the U.S. arm of their operations. He wrote, “The quality of research, validation, or even logical thinking in this “news” is appalling. If it is a board vote, 1 vote holding out of 3 won’t stop anything. The 2/3 wins. If it is a shareholder vote, Brian S. is a CEO, not a V.C. or any other type of investor. It’s just FUD. 4.”
The potential harm of a poorly fact-checked article transcends mere misinformation. In financial journalism, especially in the crypto industry, where markets are open 24/7, false stories can have immediate and substantial effects.
One such situation occurred a few weeks ago with the completely false story that Gary Gensler, chair of the SEC, had submitted his resignation. The article alleged that due to an internal investigation that was about to conclude he was guilty of serious misconduct, he had chosen to resign instead.
The article surfaced on July 1, the Saturday closest to Independence Day in the U.S. Many people take this weekend as a holiday, making verifying the story’s claims even harder. It took Fox Business reporter Charles Gasparino until July 3 to confirm that the story was false.
By then, the news had spread like wildfire, being retweeted and talked about widely in cryptocurrency circles. As literary figure Jonathan Swift wrote in 1710, “Falsehood flies, and the Truth comes limping after it.”
In a time when it’s becoming increasingly easy to create false narratives that can push the markets one way or another, the ability of the crypto community to be skeptical is of paramount importance. As we approach the next bull run, the intensity of false news will likely increase, as will scams.
In this climate of uncertainty, the commitment to write high-quality articles that educate and communicate with our community has never been more vital. As people learn about self-custody with their assets, they also must foster a sense of self-custody with their trust in crypto news. For these reasons, we are always prone to cautious optimism rather than hopium and wild claims.
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