Bitcoin News Today: SEC's Hacked Tweet Triggers $90M Bitcoin Chaos, Highlighting Cyber Paradox

The U.S. Securities and Exchange Commission (SEC) confirmed Tuesday that its official X account was compromised, leading to the dissemination of a false post claiming the agency had approved spot Bitcoin exchange-traded funds (ETFs). The unauthorized tweet, posted around 4 p.m. ET, generated immediate market volatility, with Bitcoin surging to nearly $48,000 before retreating. The post, which included a fabricated quote from SEC Chair Gary Gensler, was deleted within minutes and later attributed to a cybersecurity breach. Gensler swiftly clarified on his personal X account that the SEC had not approved the ETFs, stating, "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." SEC X account 'compromised,' posted false Bitcoin ETF news^[1]

X, the platform formerly known as Twitter, conducted a preliminary investigation and determined the breach was not due to a vulnerability in its systems but rather an unidentified individual gaining control of a phone number linked to the SEC's account through a third party. The account lacked two-factor authentication at the time of the incident, a security measure X emphasized as critical for account protection Bitcoin swings sharply after false claim that SEC …^[2]. The SEC has since regained control of the account and is collaborating with law enforcement and government partners to investigate the incident SEC says it hasn’t yet approved bitcoin ETF and its X account was ...^[3].

The false post triggered a sharp but brief spike in Bitcoin's price, followed by a reversal as traders recognized the misinformation. According to data from Coindesk, the incident led to approximately $90 million in liquidations, with both long and short positions affected. The market's reaction underscores the high stakes surrounding the SEC's pending decision on Bitcoin ETFs, with over a dozen asset managers, including BlackRock and Invesco, awaiting regulatory approval. The SEC faces a Jan. 10 deadline to act on at least one of these applications, and market participants speculate the agency may announce decisions on multiple ETFs simultaneously SEC: X Account Compromised to Falsely Approve …^[4].

The breach has intensified scrutiny of the SEC's cybersecurity practices. Republican Senators JD Vance and Thom Tillis demanded a briefing on the incident, questioning how the regulator's account was compromised Hackers Took Over the SEC’s X Account and Caused Millions In^[5]. Critics highlighted the irony of the SEC, a body frequently criticizing crypto's vulnerabilities, experiencing a security lapse. X's Safety account reiterated the importance of enabling two-factor authentication, noting the SEC's account lacked this protection during the breach Bitcoin Price Stabilizes After Fake News On ETF Approval^[6].

The incident follows a similar episode in October 2023, when a false report from a crypto news outlet about BlackRock's Bitcoin ETF approval caused a 10% price surge and $85 million in liquidations . Analysts warn that such events highlight the fragility of markets reliant on real-time social media updates, where misinformation can trigger rapid, large-scale trading activity. The SEC's delayed approval process for Bitcoin ETFs remains contentious, with proponents arguing that spot ETFs could democratize access to crypto while skeptics cite risks of market manipulation and regulatory arbitrage .

As the SEC prepares to vote on exchange filings for the ETFs, the agency maintains its stance that spot Bitcoin ETFs pose unique risks to investor protection. Gensler has previously emphasized concerns about crypto custody, market volatility, and compliance with securities laws. However, the regulator's recent legal setbacks, including a court ruling against its rejection of Grayscale's ETF conversion request, have increased pressure to approve applications .