Bitcoin price spikes then plummets after hacked SEC Twitter/X account spreads fake news
Bitcoin's price shot up on Tuesday after the Securities and Exchange Commission's (SEC) official Twitter/X account appeared to announce approval for the cryptocurrency's exchange-traded funds (ETF). Unfortunately for crypto enthusiasts, it was all a lie. The SEC soon revealed that its Twitter/X account had been hacked and that no such approval had been granted, swiftly sending Bitcoin plummeting back down.
The SEC's Twitter/X account made the false post at 4:11 p.m. ET, complete with a fabricated quote ostensibly from SEC chairperson Gary Gensler.
"Today the SEC grants approval for #Bitcoin ETFs for listing on registered national securities exchanges," read the fake post, which has since been deleted. "The approved Bitcoin ETFs will be subject to ongoing surveillance and compliance measures to ensure continued investor protection."
ETFs are groups of separate securities that can be traded in a bundle on the stock market. They're useful for diversifying investments, thus minimising risk. SEC approval of a Bitcoin ETF would have a significant impact on the crypto economy, offering it a level of legitimacy that advocates hope will lure in more investors.
Cryptocurrency fans were thrilled by the SEC's seemingly authentic announcement. The news caused Bitcoin's price to quickly jump to almost $48,000.
Sadly, crypto investors' joy was short-lived. Just 15 minutes after the fake announcement was published, the real Gensler posted that the SEC account had been hacked and that the agency had not given any approval for Bitcoin ETFs.
"The @SECGov twitter account was compromised, and an unauthorized tweet was posted," Gensler wrote on his personal Twitter/X account. "The SEC has not approved the listing and trading of spot bitcoin exchange-traded products."
Gensler's statement was reiterated by the official SEC account 16 minutes after his post, the agency apparently having regained control of its account. The correction prompted Bitcoin's price to fall as quickly as it had risen, plummeting to around $45,000.
Mashable has reached out to the SEC for comment.
Tweet may have been deleted
The official X Safety account has stated that, based on their preliminary investigations, the breach was "due to an unidentified individual obtaining control over a phone number associated with the @SECGov account through a third party." X Safety further confirmed that the SEC account did not have two-factor authentication enabled.
Twitter/X disabled its free two-factor authentication via SMS early last year, making the feature only available to paid subscribers. Free users are currently only able to use the security measure via a physical security key or an authentication app such as Google Authenticator.
This isn't the first time false news has caused Bitcoin's price to spike. Last October, mistaken reports that the SEC had approved investment company BlackRock's iShares Bitcoin ETF drove the cryptocurrency's value to a peak of $30,000. It soon fell back down after the reports were debunked. In 2021, fake press releases claiming that retailers Walmart and Kroger would respectively accept Litecoin and Bitcoin Cash (not to be confused with Bitcoin) also caused each cryptocurrency to briefly spike in value.
In a previous statement shared with multiple publications, an SEC spokesperson said that any announcements such as the approval of a Bitcoin ETF "will be posted on [the SEC] website and then published in the Federal Register."