- The SEC has been mocked to the moon and back after its account was compromised and a fake Bitcoin ETF announcement put out
- The exact circumstances are unclear, but X revealed that the agency didn’t have two-factor authentication on its account
- Bitcoin’s price fluctuated by more than $3,000
The US Securities and Exchange Commission (SEC) is facing calls for an investigation after its X account was compromised yesterday to falsely suggest that a Bitcoin ETF had been approved. In an embarrassing turn of events, SEC Chair Gary Gensler was forced to admit that the agency did not have two-factor authentication on the account having advised citizens to do just that in order to protect themselves online, leading to many mocking the agency for failing to follow through on its remit of protecting investors. Bitcoin’s price fluctuated more than $3,000 on the news, which is expected to be confirmed today.
Bitcoin Sways in the Hilarity Hurricane
Bitcoin jumped $2,000 upon the post going live, only for Gensler to reveal that it was all a non-starter:
The @SECGov twitter account was compromised, and an unauthorized tweet was posted. The SEC has not approved the listing and trading of spot bitcoin exchange-traded products.
— Gary Gensler (@GaryGensler) January 9, 2024
The reaction was immediate, with Bitcoin dropping more than $3,000 as the SEC confirmed that its account had been compromised, attributing it to an “unidentified individual” gaining control over a phone number linked to the agency’s account through a third party.
If this wasn’t enough fuel for the crypto masses, things went bananas when X revealed that the SEC did not have two-factor authentication enabled when the breach occurred. This led to some very hot takes, as one might expect:
Hi @GaryGensler this is a reminder to secure your financial accounts as well as protect against identity theft and fraud.
Remember to:
🔒Use strong passphrases or passwords
🔒Set up multifactor authentication
🔒Keep account alerts turned on#CybersecurityAwarenessMonth pic.twitter.com/KBNOV3KhAJ— ZachXBT (@zachxbt) January 10, 2024
SEC’s security system: pic.twitter.com/dCFGVBSdz4
— Milk Road (@MilkRoadDaily) January 10, 2024
How are you supposed to protect investors when you can’t even protect your Twitter account?
— Walker⚡️ (@WalkerAmerica) January 9, 2024
Did the Intern Jump the Gun?
The manner in which the SEC’s social media account was compromised remains unclear; while Gensler’s statement suggested that control was regained, questions have lingered regarding the security lapse, with some suggesting it was an inside job or, at least, an intern jumping the gun.
Criticism emerged from politicians, particularly Republicans, who raised concerns about the SEC’s inadequate security controls over its accounts. Senator Bill Hagerty of Tennessee called for accountability and demanded answers from Congress, drawing parallels between the SEC’s responsibility and that of a public company in a market-moving situation.
Some felt that the SEC was creating a rationale for rejecting the ETF applications, perhaps trying to prove the ease with which the Bitcoin market can be manipulated, but insiders expect the ETFs to be granted today. How the price will react can only be guessed at, but if yesterday’s action is anything to go by then a ‘buy the news’ event, even a temporary one, isn’t out of the question.
