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Bitcoin ETF approval was fake as SEC X account hacked

Bitcoin ETF approval was fake as SEC X account hacked Bitcoin (Getty Images)

Securities and Exchange Commission (SEC), a U.S. agency responsible for enforcing the law against market manipulation, said that a message on X claiming the approval of a bitcoin exchange-traded fund (ETF) was not authorized and that their account was hacked, according to AP News.

The post on X had falsely announced the approval, claiming “The SEC grants approval for #Bitcoin ETFs for listing on all registered national securities exchanges.”

This caused a temporary surge in bitcoin's price to more than $1,000.

A bitcoin ETF would allow people to invest in bitcoin without buying it directly from a cryptocurrency exchange like Binance or Coinbase.

After the initial misleading post, SEC Chairman Gary Gensler clarified on his personal account that the SEC had not approved the ETF, and the earlier post was unauthorized. “The SEC has not approved the listing and trading of spot bitcoin exchange-traded products,” he wrote. The price of bitcoin then dropped after the SEC's denial.

The SEC later regained control of its account, but it wasn't clear how it was hacked. X mentioned that an unidentified person gained control of a phone number linked to the account through a third party. The compromised SEC account did not have two-factor authentication activated.

Politicians, especially Republicans, criticized the SEC's security controls over its accounts. Some called for accountability and answers regarding the incident.

Approval for ETF in the U.S.

Investors are growing more optimistic about the U.S. Securities and Exchange Commission approving a bitcoin exchange-traded fund as it could open up the market to millions of new investors and attract significant investments. Traders express excitement over the possibility of an ETF approval in the United States.

This is not the first time false information about bitcoin has caused market movements. In October, a fake report suggested that BlackRock had approval for a bitcoin ETF, leading to a spike in bitcoin prices.