The official securities and exchange commission (SEC) Twitter account was hacked on Tuesday as expectations for Bitcoin spot ETF approval was at its peak, and a fake message of approval was posted.
Crypto news outlets had already published the news that all Bitcoin ETF applications had been approved, causing massive celebration in the crypto community. Shortly after, the SEC chair Gary Gensler debunked the news, saying that the SEC account was compromised and the news was fake.
“The @SECGov twitter account was compromised, and an unauthorized tweet was posted. The SEC has not approved the listing and trading of spot bitcoin exchange-traded products,” said SEC Chair Gary Gensler.
A spokesman for the agency later confirmed to crypto news outlet The Block that the information was not posted by the SEC.
“The SEC’s @SECGov X/Twitter account has been compromised. The unauthorized tweet regarding bitcoin ETFs was not made by the SEC or its staff,” the spokesperson for the SEC said.
The account hack is the biggest in 2024 so far involving a top government agency. According to Twitter, the compromise was as a result of an unprotected phone number associated with the account.
“Based on our investigation, the compromise was not due to any breach of X’s systems, but rather due to an unidentified individual obtaining control over a phone number associated with the @SECGov account through a third party,” the X team said.
Bitcoin ETF still expected
Although the news was fake, it caused a surge in the price of Bitcoin to $47,000 temporarily before dropping to $45,000 after the news was debunked. This shows just how enthusiastic the crypto community is about the approval of Bitcoin ETFs.
Commenting on the development, Bloomberg Intelligence analyst Eric Balchunas wrote on Twitter:
“I think someone prepped a planned tweet and put wrong date, bc the tweet would have made PERFECT sense tomorrow at this time. The language sounds legit SEC-ish IMO vs a crypto knucklehead pulling a prank but I guess we’ll see.”
The proper Bitcoin ETF approval is expected today Wednesday as it is the deadline for decision on at least some of the applications which have been delayed since last year. In anticipation, many changes have occurred in the crypto industry.
Several of the prospective spot bitcoin ETF issuers have dropped their fees to make their products more attractive when launched.
BlackRock for example has reduced its sponsor fee for its potential spot bitcoin ETF from 0.3% to 0.25% and reduced its temporary discount from 0.2% to 0.12% for the first $5 billion of assets in the first 12 months from launch.
SEC to Involve Law Enforcement
Following the incident, some senators have called on the SEC’s chair to address the security breach which they described as unacceptable.
The senators expressed concern that the hacking of the account could be a sign of how weak the agency’s cybersecurity system is, which puts a major government agency at risk.
In response, the agency said it will work with law enforcement to investigate what led to the compromise.
“The SEC will work with law enforcement and our partners across government to investigate the matter and determine appropriate next steps relating to both the unauthorized access and any related misconduct,” they continued.
