In a December 9 report, the hackers compromised the United States Securities and Exchange Commission (SEC) X account to announce fake approval of the spot Bitcoin exchange-traded funds (ETF).
News concerning the approval of the Bitcoin ETFs thrilled the crypto community. With the changes in the financial ecosystem the approval of the ETF will enable the investors to tap into the benefits of investing in BTC even without purchasing the world’s largest crypto by daily trading volume.
SEC Reacts to X Account Exploit
At the same time, other market critics bashed the SEC for misleading information. On X, some speculators argued that misleading information could lead to exploitative practices, forcing investors to make uninformed financial decisions.
A review of the market performance of the BTC demonstrated that the price of Bitcoin hovered around $45,000 to around $47K after the fake post. The impressive price movement forced investors to sell their BTC despite the volatile nature of Bitcoin.
Consecutively, minutes after the hackers posted the fake approval of the crypto ETF, the price of Bitcoin gained a bullish momentum.
The impressive upward trajectory established by BTC was reversed after the SEC responded to the fake X post. A statement from the SEC Safety team demonstrated that the market regulators have not approved the Bitcoin ETFs.
SEC Commissioner Warns Investors Crypto Scam
In the report, the SEC regretted that an unknown person exploited the X account. Elsewhere, the SEC chair Gary Gensler confirmed that the commission had not approved the spot Bitcoin ETF.
In his tweet, the SEC commissioner advised investors to be vigilant while investing in digital assets due to the inherent risk of crypto scams. He stated that the fraudsters are taking advantage of the growing popularity of crypto assets.
Gensler underlined that attackers are actively preying on the crypto industry to launch fraudulent schemes such as the pyramid and Ponzi schemes.
However, before Gensler’s speech, various media outlets shared the good news concerning the approval of the Bitcoin ETFs. A review of the fake post demonstrated that the SEC chair had confirmed the approval of the Bitcoin ETF.
The fake tweet received a big audience from the X community. In retaliation for the attack, the commission restated that an unknown individual made the unauthorized tweet.
Risk Associated with Approval of Bitcoin ETF
The SEC claimed that the post was neither from the commission nor its employees. The fake post came days before the commission is expected to provide feedback concerning the spot Bitcoin ETF.
For nearly a decade, the SEC has been reluctant to approve Bitcoin ETFs due to non-compliance with the law. The SEC claimed the asset managers failed to deploy adequate security measures to address price manipulation and fraud.
Since then, the SEC has been against the approval of the Bitcoin Fund. The delays in approval of the spot Bitcoin ETF forced the asset managers to step up and convince the SEC to reverse its course.
After multiple meetings with the market regulators, the SEC is expected to approve the Bitcoin ETFs on January 10. Despite the intense efforts made by the SEC to shield the crypto sector from manipulation, the January 9 exploit ignited a tide of criticism from industry leaders.
In a separate report, the renowned US Senator Bill Hagerty advised the SEC to maintain the same high standards of accountability as it demands from businesses.The Senator underlined the need for the SEC to apply adequate security measures to address manipulation and misinformation.