The fake tweet on social network X (formerly Twitter) that shook the cryptocurrency market on January 9 was likely not published by the US Securities and Exchange Commission (SEC), according to the director of the Blockchain Association.
In Topic X on January 16, Blockchain Association Government Relations Director Ron Hammond said that a tweet announcing the approval of a Bitcoin (BTC) spot exchange-traded fund that the SEC said was “compromised” was unlikely to have been issued by the commission. Many online speculated that someone at the SEC posted a tweet announcing the ETF's approval prematurely, given that the commission officially filed the application on Jan. 10.
“When this news broke, it was a false tweet, many in D.C. immediately thought it was a communications error,” Hammond said. “For big events like an ETF announcement, it's common for agencies/firms to spend hours refining tweets so that the idea of someone accidentally hitting send makes sense.”
The Director of the Blockchain Association added:
“[М]none of the elements of the tweet were in the style of the SEC Communication. The Bitcoin logo is a good example. The graphics were also not standard. So whoever was behind this, it probably wasn't the SEC.”
SEC Chairman Gary Gensler and the commission said a Jan. 9 tweet that suggested a “false start” for the launch of several spot Bitcoin ETFs was the result of X's “compromised” account. On Jan. 10, the social media platform's security page announced that the SEC was not enabled multi-factor authentication.
“Whoever had access to the account decided to take advantage of this moment, and the extent of the effort raises many questions,” Hammond said. “But the SEC started off on a bad foot when they announced they didn't have two-factor authentication enabled.”
On the subject: Bitcoin ETF False Start: Hacker or SEC Intern with Fat Fingers?
Following the market-shaking tweet, many US lawmakers called for an investigation into the SEC's actions. Senators Ron Wyden and Cynthia Lummis sent a letter to SEC Inspector General Deborah Jeffrey on Jan. 11, calling it “inexcusable” that the commission failed to follow its security protocols. The Securities and Exchange Commission (SEC) said it was coordinating with the FBI to investigate the hack.
Following the listing of several Bitcoin ETF shares, U.S. exchanges reportedly saw more than $1 billion in inflows into cryptocurrency products in the week ending January 12. The SEC's approval of Bitcoin futures ETFs in October 2021 resulted in approximately $1.5 billion in inflows in its first week of trading.