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The US Securities and Exchange Commission (SEC) has announced the approval of bitcoin exchange-traded funds (ETFs), despite saying the opposite yesterday (10 January) in response to a hijacked tweet.
The new approval will allow investors to trade bitcoin just as they would stocks and mutual funds, a major step away from the need to trade on crypto exchanges that include major fees. The news of this has spiked the value of bitcoin to almost $70,000.
The new announcement, which was outlined in an SEC release, comes just a day after the SEC announced that its X (formerly Twitter) account had been hijacked, with the unauthorised user posting that the bitcoin ETFs had been approved.
“Today the SEC grants approval to Bitcoin ETFs for listing on registered national security exchanges,” read the fake post.
“The approved Bitcoin ETFs will be subject to ongoing surveillance and compliance measures to ensure continued investor protection.”
The post was accompanied by a statement by SEC chair Gary Gensler.
“Today’s approval enhances market transparency and provides investors with efficient access to digital asset investments within a regulated framework,” the statement on the false post said.
However, shortly after the post was made, it was taken down and replaced with a post that announced that the SEC X account had been hijacked and that the SEC had not approved bitcoin ETFs.
“The @SECGov twitter account was compromised, and an unauthorized tweet was posted,” wrote Gensler on his X account.
“The SEC has not approved the listing and trading of spot bitcoin exchange-traded products.”
The @SECGov X account was compromised, and an unauthorized post was posted. The SEC has not approved the listing and trading of spot bitcoin exchange-traded products.
— U.S. Securities and Exchange Commission (@SECGov) January 9, 2024
Now, it seems, however, that the SEC has done exactly what it said it hadn’t, which is a shocking turn of events considering it has held a strong stance against bitcoin ETFs for a decade due to concerns that they could be manipulated easily.
The SEC has not yet announced exactly what happened with yesterday’s hijacking. X itself made a post saying that it could confirm that the hijacking was indeed done by a third party and outed the SEC for poor security.
“We can confirm that the account @SECGov was compromised and we have completed a preliminary investigation,” it wrote.
“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.
“We can also confirm that the account did not have two-factor authentication enabled at the time the account was compromised. We encourage all users to enable this extra layer of security.”
While there is nothing conclusive to say exactly what the motives of the third party were, it is interesting that the SEC announced bitcoin ETF approval the day after.
This could mean that the SEC had scheduled the announcement but that it was posted early by the threat actor, but it is hard to say why. If the hijacker’s intention was to manipulate the market, they certainly succeeded.
Cyber Daily has reached out to the SEC asking if the announcement was always due for today (11 January) or if it reacted to the incident, as well as for additional information regarding the breach.
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