SEC's X account hijacked to falsely announce Bitcoin ETF approval
What's the story
The US Securities and Exchange Commission (SEC) recently experienced a security breach when its official X account posted a false claim about the approval of Bitcoin ETFs for listing on national securities exchanges. SEC Chair Gary Gensler clarified that the tweet was unauthorized, stating, "The @SECGov twitter account was compromised, and an unauthorized tweet was posted." Gensler further clarified that it "has not approved the listing and trading of spot Bitcoin exchange-traded products."
Details
Impact on Bitcoin prices and market
This misleading tweet caused a temporary spike in Bitcoin prices, followed by a sharp drop. CoinDesk's analysis revealed that the tweet and Gensler's clarification resulted in over $50 million worth of leveraged derivatives trading positions being wiped out within an hour. The SEC is currently reviewing whether to approve spot Bitcoin ETFs, with a decision expected on Wednesday.
What Next?
Preliminary investigation by X
An initial investigation into the security breach showed that it was not due to a system failure. Instead, an unknown individual gained control of a phone number linked to the @SECGov account through a third party. The account did not have two-factor authentication enabled at the time of the incident. The Elon Musk-owned social media company stated, "We can confirm that the account @SECGov was compromised and we have completed a preliminary investigation."
Insights
Questions raised about security measures
This event raises concerns about the security measures in place for government-run social media accounts, which should use multi-factor authentication for added protection. If the SEC had weak security settings, it could be a significant embarrassment for the agency. This is not the first time high-profile government accounts have been targeted on X. In 2020, hackers took over accounts belonging to Barack Obama, Joe Biden, Elon Musk, and Bill Gates in a coordinated cryptocurrency scam.