SEC Social Media Account Hacked, Fake Bitcoin ETF Approval Post Temporarily Boosts Prices

The U.S. Securities and Exchange Commission (SEC) encountered a security breach when an unauthorized individual accessed its social media and published a fictitious announcement about Bitcoin ETFs. This fraudulent message falsely claimed the SEC had sanctioned exchange-traded funds for Bitcoin, an event the cryptocurrency sector has been anticipating with bated breath.

Following the discovery of the breach, the SEC clarified that it has not approved any spot Bitcoin ETFs. The temporary control of the SEC's account by the hacker occurred after 4 PM U.S. Eastern time, but the unauthorized access was promptly revoked.

The SEC intends to collaborate closely with law enforcement to scrutinize the incursion and any related activities. X, previously known as Twitter, confirmed the security of the SEC's account and is delving into the incident's origins.

The imposter's post included a fabricated quote from SEC Chair Gary Gensler and misled the public into believing that Bitcoin ETFs had received the green light on all registered national securities exchanges. The hoax caused a fleeting surge in Bitcoin's price, drawing attention from Reuters and other media outlets monitoring the SEC's social media presence.

Despite the industry's anticipation for an affirmative verdict on Bitcoin ETFs, this deceptive post caused confusion and concern among market insiders. Some feared that the hack might provoke the SEC to postpone or deny the authorization of spot Bitcoin ETFs.

Nevertheless, legal experts like Anthony Tu-Sekine believe the unfortunate event is unlikely to impact the approval process, which was already expected. The reason behind such a stunt remains baffling to industry observers.

Brief Price Spike

The fake SEC post gained rapid traction, reaching over a million views in minutes. Bitcoin's price responded by soaring to approximately US$48,000, only to dip under US$45,000 shortly afterward. The cryptocurrency ultimately experienced a modest decline following the removal of the counterfeit claim.

The SEC refrained from grading the potential influence of the security compromise on future ETF approvals. Historically, the SEC has consistently turned down spot Bitcoin ETF proposals, citing market manipulation concerns.

X, among other social media platforms, can be susceptible to hijacking, either through credential theft or through systemic platform vulnerabilities. Instances of high-profile account hacks—even those belonging to celebrities and prominent figures—serve as a stark reminder of social media's susceptibility to misinformation.

The reliance on instant social media updates for news accentuates the risk of misinformation spread, as noted by academic James Angel. The hack exemplifies the need for heightened vigilance against such deceptive information intrusion in the digital age.

SEC, Bitcoin, Hack