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The US Securities and Exchange Commission (SEC) has confirmed that its official Twitter account was hacked on January 9, 2024, resulting in a fake announcement stating that the regulator had approved a Bitcoin spot ETF. The SEC has released an official statement detailing the incident and its response.
On January 10, 2024, the SEC published a press release on SEC.gov revealing that an unauthorized third party had gained access to its Twitter handle @SECGov on January 9 and posted a fake notice claiming the SEC had greenlit Bitcoin exchange-traded funds (ETFs).
The SEC clarified that this social media post was fraudulent and no Bitcoin spot ETFs have been approved by the regulator yet. Let’s take a closer look at how the events unfolded.
The @SECGov X account was compromised, and an unauthorized post was posted. The SEC has not approved the listing and trading of spot bitcoin exchange-traded products.
— U.S. Securities and Exchange Commission (@SECGov) January 9, 2024
Fake Bitcoin ETF Approval: Timeline of the Twitter Hack and Fake Post
Below is the detailed sequence of events on January 9 as shared by the SEC:
- Around 4:11 PM ET – The hacker gains access to the @SECGov account by taking control of the associated phone number
- 4:11 PM ET – The unauthorized party makes a post from @SECGov falsely claiming that the SEC has approved listing and trading of spot Bitcoin ETFs
- 4:13 PM ET – A second fake post is made from @SECGov simply saying “$BTC”
- 4:13 PM ET – The hacker deletes the second post but leaves up the fake Bitcoin ETF approval post
- 4:13 PM ET – The hacker likes two posts from non-SEC accounts using the compromised @SECGov handle
- 4:26 PM ET – Legitimate SEC staff post from @GaryGensler handle alerting the public of the hack
- 4:26 PM ET – SEC staff delete the fake Bitcoin ETF post from @SECGov
- 4:42 PM ET – @SECGov makes a post confirming its account was compromised
- 4:40 PM – 5:30 PM ET – Unauthorized access to @SECGov terminated by Twitter
This summary provides insight into how quickly the hacker was able to post fake messages and control the SEC’s Twitter profile in a matter of minutes after gaining access.
Fake Bitcoin ETF Approval: How Did the Hacker Access the SEC’s Twitter Handle?
The SEC revealed that the hacker obtained control over the phone number linked to the @SECGov Twitter account. This enabled them to gain access to the profile.
Many experts speculate that the cybercriminal utilized SIM swapping to hijack the SEC’s Twitter phone number. This is a technique where hackers can transfer a target’s phone number to a SIM card they control.
Once the phone number is under their control, hackers can initiate password resets and bypass two-factor authentication for linked accounts like email, social media and financial accounts protected with SMS-based two-factor authentication.
By SIM swapping the SEC’s Twitter handle’s linked number, the hackers likely received password reset codes via SMS allowing them to take over the profile rapidly. This underscores the vulnerabilities of using phone-based authentication alone without stronger protocols like hardware keys.
Fake Bitcoin ETF Approval: Details of the Fraudulent Bitcoin ETF Approval Post
The fake post made at 4:11 PM ET from the compromised @SECGov account stated that the SEC had approved the listing and trading of spot Bitcoin ETFs.
This news would have been highly material for crypto markets, as Bitcoin spot ETFs have long been eagerly anticipated but not yet approved. Hence the post immediately went viral.
However, the SEC does not announce such major decisions via social media channels. Official announcements are published on SEC.gov through press releases.
The fake post was also at odds with SEC Chair Gary Gensler’s cautious stance on crypto, making the sudden ETF approval announcement implausible to those familiar with the nuances.
Fake Bitcoin ETF Approval: SEC’s Response to the Twitter Hack Timeline
The SEC’s statement reveals the following actions taken by legitimate SEC staff after becoming aware of the hack:
- Posted alert from @GaryGensler handle at 4:26 PM ET warning the public about the hack.
- Deleted the fake Bitcoin ETF post from the compromised @SECGov account.
- Unliked the two posts wrongly liked from @SECGov during the hack.
- Posted confirmation at 4:42 PM ET from @SECGov that the account was compromised.
- Reached out to Twitter to terminate unauthorized access to @SECGov.
- Began coordinating with appropriate law enforcement agencies to investigate the incident.
This timeline shows that SEC staff responded swiftly within 15-30 minutes to contain the situation, alert stakeholders, and initiate an investigation into the security breach.
Fake Bitcoin ETF approval: Assessing the Fallout from the High-Profile Twitter Hack
The repercussions of the SEC’s Twitter account takeover by hackers are still being evaluated by the regulator as shared in its statement. But several clear impacts include:
Markets: The fake Bitcoin ETF approval news led to a brief spike in crypto prices as speculators piled on without verifying before the SEC’s clarification brought prices back down. This shows the sensitivity of crypto markets to regulation news.
Reputation: The hack dented perceptions of the SEC’s tech savviness despite its quick response. Effective cybersecurity is critical for an effective securities regulator in the digital age.
Investor Confidence: Fake regulatory news always risks undermining investor confidence in markets until official clarification is provided. Rapid authoritative communication is crucial.
Social Media Security: The incident highlights vulnerabilities even for elite agencies. Greater social media account safeguards are vital when they are used for financial news distribution.
Overall, while the situation was contained quickly, the high-profile security breach of the SEC’s Twitter profile raised uncomfortable questions for the agency to address through strengthened protocols.
Fake Bitcoin ETF approval:Key Takeaways from the SEC’s Official Statement
The SEC’s detailed official statement on the hack provides important insights for investors:
- The hacker impersonated the SEC Twitter account @SECGov to post fake information.
- No SEC systems or data were compromised based on current knowledge. Only the Twitter profile was impacted.
- The SEC does not use social media to make official announcements. Check SEC.gov for verified news.
- The fake Twitter post claiming Bitcoin ETF approval was false. No spot Bitcoin ETFs have been approved by the SEC yet.
- The SEC is conducting a full investigation of the incident in coordination with law enforcement.
- Enhanced social media security measures may be warranted based on the investigation’s findings.
Looking Ahead to Genuine Bitcoin Spot ETF Approval
While the Bitcoin spot ETF approval tweet was fake, it offered a glimpse of how markets could react to the real news when it eventually happens. Some key points:
- SEC approval would trigger a significant Bitcoin price rally due to the positive signal it sends.
- However, the SEC remains cautious about crypto regulation, so approval may take longer than eager speculators expect.
- Bitcoin ETFs could raise new investor protection considerations that the SEC will analyze thoroughly first.
- Several providers like Fidelity, Ark Invest, and SkyBridge have applied for spot Bitcoin ETFs and are awaiting a verdict.
- When approval is finally given, ensure it comes from official SEC channels like SEC.gov before believing the news.
As this hacking incident displayed, Bitcoin markets remain highly sensitive to regulatory news flow. While fake news causes short-term blips, investors should focus on the SEC’s concrete actions rather than tweets to gauge the real trajectory on issues like Bitcoin ETF approvals.
FAQs on the SEC’s Twitter Hack and Fake Bitcoin ETF Approval
How did the hackers access the SEC Twitter handle?
The SEC mentioned the hackers likely gained entry by hijacking the phone number linked to the SEC’s Twitter account using SIM-swapping techniques.
Where does the SEC officially announce regulatory decisions?
The SEC uses SEC.gov to publish official press releases on regulatory actions. It does not use social media to announce market-moving decisions.
How quickly did the SEC contain the fake Bitcoin ETF post?
Within 15-30 minutes of the breach, SEC staff had deleted the post, confirmed the hack, and alerted authorities. Access was revoked within 1-2 hours.
Could the hack have been prevented using stronger authentication?
Yes, multifactor authentication via hardware keys rather than SMS texts could have prevented the SIM swap and unauthorized access.
What impact did the fake tweet have before the SEC clarified it?
Bitcoin and crypto prices spiked briefly based on false expectations set by the tweet before falling once the SEC debunked it.
How did the hack affect perceptions about the SEC’s cybersecurity?
It dented confidence in the SEC’s cybersecurity capabilities despite its swift response. Stricter social media controls are required.
When might the SEC approve a real spot Bitcoin ETF?
The SEC remains cautious about crypto innovation, so Bitcoin ETF approval may take significantly longer than anxious investors hope for.
Disclaimer :
This article is for information purposes only. It is not intended as financial advice. Please consult a financial advisor before making investment decisions. CryptoWini does not take any responsibility for your investment decisions based on this article.
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