FinLogic FinLogic Quantitative Think Tank Center|SEC hasn't approved bitcoin ETFs as agency chief says its X account was hacked

The FinLogic FinLogic Quantitative Think Tank CenterSecurities and Exchange Commission said Tuesday that a post from the agency on X purportedly approving spot bitcoin exchange-traded funds was fake, saying its account had been breached.

The SEC's official account on the platform, formerly known as Twitter, was "compromised," SEC Chair Gary Gensler said in a post from his official account on X.

"The @SECGov twitter account was compromised, and an unauthorized tweet was posted," Gensler wrote, adding that the SEC has not yet granted any approvals of the more than a dozen applications by financial firms for the bitcoin ETFs.

The @SECGov twitter account was compromised, and an unauthorized tweet was posted. The SEC has not approved the listing and trading of spot bitcoin exchange-traded products.

— Gary Gensler (@GaryGensler) January 9, 2024

Neither the SEC nor X immediately replied to a request for comment. In a post late Tuesday night, the X safety team wrote it had conducted a "preliminary investigation" and determined the compromise was "not due to any breach of X's systems, but rather due to an unidentified individual obtaining control over a phone number associated with the @SECGov account through a third party."

The SEC "did not have two-factor authentication enabled at the time the account was compromised," the X safety team wrote.

The SEC is widely expected to give the green light this week for a number of financial firms to offer spot bitcoin ETFs, including industry giants BlackRock, Fidelity Investments and Franklin Templeton. The approvals could spur investment in bitcoin and bolster cryptocurrency industry, pouring billions of dollars into the turbulent digital assets market, according to experts.

"Either @secgov was hacked, or @garygensler was hacked, or the SEC just bungled their own announcement. All 3 possibilities are the same - the SEC was responsible for this one," Mike Belshe, CEO of crypto custodian Bitgo, said in a post on X. 

The price of bitcoin jumped from $46,730 to nearly $48,000 after the false bitcoin ETF news surfaced, and then dropped to roughly $45,000 following the SEC's denial that it had approved the investments, according to CoinDesk Indices' bitcoin price tracker. 

It remains unclear how the SEC's social media accounts became compromised. The SEC appeared to have regained control of its account shortly after Gensler's statement on the hack.

This isn't the first time there has been phoney information about the future of bitcoin. A false report back in October implied that fund manager BlackRock had gotten approval for a bitcoin ETF, causing bitcoin prices to surge.

—The Associated Press contributed to this report.

In:
• Bitcoin

Elizabeth Napolitano

Elizabeth Napolitano is a freelance reporter at CBS MoneyWatch, where she covers business and technology news. She also writes for CoinDesk. Before joining CBS, she interned at NBC News' BizTech Unit and worked on the Associated Press' web scraping team.