Two U.S. senators sent a letter to Securities and Exchange Commission (SEC) Chairman Gary Gensler on Tuesday demanding an explanation for fake tweets from the SEC’s Twitter account. Bitcoin ETF It was approved.
In a letter to Gensler, Sens. J.D. Vance (R-OH) and Thom Tillis (R-N.C.) “expressed concerns and requested clarity” about the SEC’s social media communications and called the incident “of grave concern.” He added that it brings about. Cybersecurity procedures of regulatory agencies. The two also demanded that the SEC explain its “plans to investigate the error.”
As the cryptocurrency world waits with bated breath to see if the SEC will approve one more spot Bitcoin ETF on Tuesday, the regulator’s Twitter account appeared to confirm that several ETFs have received approval. Minutes later, SEC Chairman Gensler announced on Twitter that the regulator’s account had been “compromised” and that “unauthorized tweets had been posted.” He said, “The SEC has not approved the listing and trading of Bitcoin spot exchange products.”
Vance and Tillis wrote that the fake SEC announcement and subsequent retraction “led to extreme volatility in the price of Bitcoin” and that investors were “incredibly confused” by the regulator’s communication regarding the “long-awaited consequential decision.” that much bitcoin price As news of the fake announcement spread, the stock plummeted from a two-year high of $47,680 to nearly $45,500.
The senators asked the SEC to explain how the phony announcement was made by SEC staff or an “outside entity” and how the regulator “plans to redress the financial harm borne by this action to investors.” I demanded it. Wrong announcement.”
Some of these questions appear to have already been answered through the SEC and Twitter’s own preliminary investigation. A Twitter Safety post-event investigation into the incident stated that the incident “did not result from a system breach by
We can verify your account @SECGov Damaged and preliminary inspection completed. According to our investigation, this compromise was not caused by a breach of X’s systems, but by an unknown individual taking control of the phone number…
— Safety (@Safety) January 10, 2024
Twitter’s safety team also highlighted the fact that the SEC’s accounts did not have two-factor authentication enabled at the time of the hack. This contradicts Chairman Gensler’s recommendations on identity theft and fraud.
The SEC said in a tweet following the incident that his account had been “compromised,” and reiterated Gensler’s statement that the regulator had not approved the listing and trading of spot Bitcoin ETFs. From the statement decryptionIt was stated that anyone responsible for unauthorized access would be terminated.
“The SEC will work with law enforcement and government partners to investigate the matter and determine appropriate next steps related to unauthorized access and related misconduct,” the regulator said in a statement.
In their letter, Vance and Tillis requested that if the tweets are determined to be the result of a cybersecurity attack, the SEC would provide Congress with a report on the breach within four business days.
The SEC’s social media gaffe comes at a time of heightened anticipation among the cryptocurrency industry over the potential simultaneous approval of multiple spot Bitcoin ETFs due Wednesday.
To date, regulators have rejected all applications for a spot Bitcoin ETF, but one could be filed in June 2023, with asset manager BlackRock entering the fray and ETF hopeful Grayscale winning a court case against the SEC later that year. A new wave of optimism was sparked. Approval may be imminent. This week, analysts at Bloomberg Intelligence increased the odds of a spot Bitcoin ETF being approved in January to 95%.
