Bitcoin surged temporarily on Tuesday when the US markets regulator’s X account (previously Twitter) announced the approval of new cryptocurrency exchange-traded funds (ETFs).
The Securities and Exchange Commission (SEC) later deleted the message, stating that its account had been “compromised”.
The social networking company stated that the compromised account did not result from a system breach.
US regulators are scheduled to announce the new ETFs this week.
The bogus post was published on the SEC’s official X account shortly after 16:00 Washington time (21:00 GMT).
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Bitcoin ETF: Cryptocurrency Swings As Watchdog X Account ‘Compromised’
It stated that the Securities and Exchange Commission “grants approval for #Bitcoin ETFs for listing on all registered national securities exchanges”.
Social media users and business news sources quickly shared and quoted the tweet.
Within minutes, SEC Chair Gary Gensler tweeted a response on his personal X account contradicting the incorrect announcement: “The @SECGov Twitter account was compromised, and an unauthorized tweet was posted.” The SEC has not approved the listing or trading spot bitcoin exchange-traded products.”
“The SEC has determined that there was unauthorized access to and activity on the @SECGov x.com account by an unknown party for a brief period of time shortly after 4 pm ET,” a spokeswoman for the Securities and Exchange Commission said.
“That unauthorized access has been terminated,” they went on to say. “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.”
Later on Tuesday, X announced that it had finished a preliminary investigation into the bogus post on the SEC’s account and determined that it was not the result of a breach of the social media platform’s systems.
“We can confirm that the account @SECGov was compromised and we have completed a preliminary investigation,” X stated.
Bitcoin ETF: Cryptocurrency Swings As Watchdog X Account ‘Compromised’
“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,” according to the statement.
“We can also confirm that the account did not have two-factor authentication enabled at the time the account was compromised.”
Bitcoin surged to about $48,000 (£37,800) shortly after the incorrect article before falling back to roughly $46,000.
Investors are eagerly anticipating the SEC’s news on the potential approval of spot bitcoin ETFs, which is expected this week.
It would be a significant milestone for the cryptocurrency market’s acceptance in mainstream financial markets.
Several asset management firms have sought SEC clearance for spot Bitcoin ETFs.
ETFs are portfolios that allow investors to wager on various assets without having to buy them individually.
Bitcoin ETF: Cryptocurrency Swings As Watchdog X Account ‘Compromised’
They trade like shares on stock exchanges, and the performance of the entire portfolio in real time determines their value.
Some ETFs already indirectly contain Bitcoin; however, a spot Bitcoin ETF will buy the cryptocurrency directly, “on the spot” at its current price throughout the day.
Bitcoin is a decentralized digital currency that operates without a central authority or banks. It allows for peer-to-peer transactions to take place directly without the need for intermediaries. The technology behind bitcoin, known as blockchain, ensures the security and transparency of these transactions.
With a limited supply of 21 million coins, bitcoin is often seen as a hedge against inflation and a store of value. Its fluctuating price has led to both skepticism and enthusiasm among investors and has sparked discussions about the future of finance and monetary systems.
SOURCE – BBC
