A fake SEC announcement regarding the approval of Bitcoin exchange-traded funds caused confusion yesterday. Hackers gained access to the SEC user account on the short message platform X.
Conflicting announcements regarding the approval of Bitcoin exchange-traded funds (ETFs) sent the crypto industry into turmoil yesterday. According to a message from the official account of the US Securities and Exchange Commission (SEC) on Elon Musk’s online platform Bitcoin can be invested (Bitcoin Spot ETF).
The Bitcoin price then rose, because that would be good news for investors: “Investors would then have access to Bitcoin through regulated providers without having to go through a crypto exchange that they don’t trust,” explains Jochen Stanzl from the broker CMC Markets: “In this way, large investment sums would be conceivable, which until now have simply been too risky for many people.”
SEC account hacked
The false announcement also matched the expectations of many investors, as ETF approval is expected this week. Several providers had applied for approval of such funds. The deadline for a decision on at least one of the applications expires this week. There was therefore speculation that the SEC wanted to use this as an opportunity to make a fundamental decision on several applications. Observers expected a decision this Wednesday.
After this announcement from the official account of the US Securities and Exchange Commission (SEC) on Elon Musk’s online platform X, it initially seemed that the way for a listing was clear. But a little later, the head of the authorities, Gary Gensler, announced that the announcement had been wrong. X’s SEC account was hacked.
Bitcoin price reacts
The price of the oldest and best-known digital currency initially jumped up on the Coinbase trading platform yesterday, but then turned around just above the $47,900 mark and temporarily slipped to the $46,000 mark. The Bitcoin price had recently benefited significantly from speculation about a hoped-for positive decision: since mid-October alone, it had gained 76 percent at its peak.
According to X, the SEC profile was hijacked because someone gained access to the phone number associated with it. At the same time, X let the public know that at the time of the hack, the SEC account was not protected with so-called two-factor authentication, which would have made it much more difficult to hijack.
“Bland aftertaste in investor circles”
“The recent confusion surrounding the supposed approval of a Bitcoin spot ETF in the USA is likely to leave a bad aftertaste in investor circles,” comments market analyst Timo Emden. The misleading news would impressively underline the challenges of investor protection, said the market observer. “The chances have increased that the SEC will put its decision on hold at the last minute.”
James Angel, an associate professor at Georgetown University’s McDonough School of Business, told Reuters: “We’re definitely becoming more vulnerable to this kind of instantaneous misinformation.”
It is unclear what approval would mean for the Bitcoin price in the short term. Since the cryptocurrency had already risen sharply in advance, according to Stanzl, many investors could therefore tend to make profits from their successful speculation after a positive decision.