On January 9, the crypto community condemned the US Securities and Exchange Commission (SEC) for misleading the investors after the hackers exploited their X account. In the tweet, the hackers claimed that the SEC had approved the Bitcoin ETFs.
The tweet created heated exchanges among the crypto community, forcing the SEC to take immediate action to investigate the matter. After intense discussion, the X agreed to support the SEC in the ongoing investigation to convict the hackers.
SEC Teams Up with Twitter to Investigate Fake Tweet
A review of the report from the commission demonstrated that there was unauthorized access to the X account @SECGov x.com. The SEC claimed the hackers compromised the X account after 4 pm ET.
After discovering that the SEC X account was hacked, the regulators addressed the matter. Following the January 9 hacking incident, the SEC agreed to collaborate with various law enforcement units and critical stakeholders to probe the matter.
In the report, the SEC anticipates that after the investigation, the probing team will recommend practical measures to address unauthorized access and any misconduct cases. A report from the SEC Safety team demonstrated that the commission failed to enable two-factor authentication (2FA) on its X account.
The Safety team regretted that the lack of 2FA features enabled the hackers to access the X account. In the report, the SEC claimed that an unknown individual obtained the official phone number to compromise the X account.
The probing team argues that the attackers deployed techniques similar to the SIM swap hack. According to the report, the SEC officials described the SIM swap as an event where the attacker took control of the victim’s phone number and gained unauthorized access to social media and bank accounts.
Hackers Compromise SEC X Account
Following the hacking incident, the SEC suspected that the attackers liaised with a third-party telecommunication provider to take charge of the SEC details, including phone numbers and email addresses.
This implies that the hackers obtained details from the third party, including the official email address used to create the X accounts. The SEC claimed that after receiving the email and phone number, the hackers used this information to reset the SEC password and other details.
Shortly after the hacking incident, the SEC chair Gary Gensler confirmed that the regulators had not approved any spot Bitcoin ETF. Gensler urged investors to be careful when investing in digital assets due to crypto scams.
Reportedly, minutes after the hackers posted the fake approval of the spot Bitcoin ETFs, BTC gained a bullish momentum. According to CoinMarketCap, the price of BTC hovered around $450000 to $47K after the incident.
US Senator Slam of SEC Due to Misleading Information
The impressive price movement of BTC created excitement among crypto investors, leading to increased selling pressure. However, based on the volatile nature of crypto assets, some market critics condemned the SEC for failing to implement adequate security measures on the X platform.
Other X users urged the SEC to maintain high accountability when running its business. Also, the investors blamed the SEC for failing to implement adequate cybersecurity internal control measures necessary for safeguarding consumers from manipulative business practices.
Elsewhere, US Senator J.D Vance and Thom Tillis condemned the SEC for lack of implementation of operation security measures. Shortly after the attack, the US Senators demanded the SEC provide a detailed explanation concerning the fake post by January 13.