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The U.S. Securities and Exchange Commission's (SEC) social media account was recently compromised, leading to the dissemination of false information regarding the approval of a bitcoin exchange-traded fund (ETF). This caused an initial surge in bitcoin prices before they plummeted. The incident has sparked calls from lawmakers and crypto industry participants for SEC Chair Gary Gensler to clarify how the breach occurred.
According to CoinDesk, hackers reportedly exploited the SEC's official social media account to falsely announce the approval of all pending bitcoin ETF applications. This led to a temporary increase in bitcoin prices, which subsequently fell when traders realized the posts were fraudulent.
Decrypt reported that following the fake post, bitcoin prices rose from $46,600 to $47,680, marking a two-year high. However, they soon dropped to $45,500. Experts had been anticipating an announcement from the SEC regarding Bitcoin ETFs on Jan. 10, with trading expected to commence on Jan. 11.
The SEC addressed the issue via its social media platform stating, "The @SECGov account was compromised, and an unauthorized post was posted. The SEC has not approved the listing and trading of spot bitcoin exchange-traded products."
Crypto attorney James Murphy commented on this matter saying, "Congress needs to call @GaryGensler to testify and explain what happened and how he plans to make investors whole."
U.S. Sen. Cynthia Lummis (R-Wyo.) expressed her concern over this issue stating on her social media account that "Fraudulent announcements, like the one that was made on the SEC’s social media, can manipulate markets. We need transparency on what happened."
On Jan. 10, CNBC reported that the SEC officially approved trading of spot Bitcoin ETFs which resulted in its price reaching its highest level since 2021 at over $49,000 briefly. The crypto community has been advocating for a Bitcoin ETF for over a decade.
The SEC, as per its website, is a federal regulatory agency with jurisdiction over the securities industry. It is tasked with protecting securities investors and maintaining market fairness. The agency comprises five Commissioners who are appointed by the President and confirmed by the U.S. Senate.
