Elon Musk’s Twitter pointed fingers at a Wall Street regulator for a breach that led to bitcoin scammers hacking its social media account. The Securities and Exchange Commission’s (SEC) Twitter account posted a message late Tuesday claiming approval of a Bitcoin exchange-traded fund (ETF), briefly boosting Bitcoin’s price before the SEC denied the statement, acknowledging its compromised account.
In a tweet shared by Musk, the company attributed the breach not to its systems but to the SEC’s failure to activate additional security measures. They clarified that the compromise occurred due to an unidentified person seizing control of a phone number linked to the SEC account, exploiting the absence of two-factor authentication.
Two-factor authentication adds an extra security layer, requiring a secondary code, typically sent to a user’s phone or security app, for account access.
The fake SEC post proclaimed the regulator’s approval for Bitcoin ETFs on national registered exchanges, causing a momentary surge in Bitcoin to $47,900, followed by a 3% crash.
The prospect of a Bitcoin-linked ETF has excited crypto investors as it could provide exposure to the digital coin without directly holding it, potentially broadening access to traditional and retail investors. Major investment firms like Blackrock and Fidelity are exploring these funds, with analysts predicting a possible spike in Bitcoin’s value to $200,000 by 2025 upon approval.
The hack is a setback for the SEC, which has cautioned against Bitcoin scams. Gensler reiterated that the SEC hadn’t approved spot Bitcoin exchange-traded products.
This incident revives Musk’s history with the SEC, stemming from his controversial tweet about Tesla’s privatization plans in 2018. Musk settled with the SEC, paying a $20 million fine and stepping down as Tesla’s chairman without admitting guilt.
