False alarm in the cryptocurrency sector. A tweet from the official X (Twitter) account of the US Securities and Exchange Commission (SEC) announced this Tuesday that the green light was given to ETFs – exchange-traded funds – linked to the spot price of bitcoin, a instrument that promises to revolutionize the market by facilitating the entry of institutional investors. The long-awaited news boosted the price of bitcoin and other cryptocurrencies, with sudden increases. The problem is that everything was false.
The SEC account on the platform was hacked and the tweet was published without its authorization. “Today the SEC approves bitcoin ETFs for listing on all national stock exchanges,” the message said. “They will be subject to surveillance and compliance measures to ensure consumer protection,” he concluded. A photo with a quote from SEC Chairman Gary Gensler about the approval gave more substance to the tweet.
After its publication, bitcoin went from trading at $46,700 to around $47,900 in just 5 minutes, a 3% rise, according to data from Coinmarketcap.
About 15 minutes later, the same platform reported that the account had been hacked and that the SEC “has not approved the listing or marketing of spot bitcoin ETF products.” That punctured the market and in just one hour bitcoin fell to $45,466, 5% below the maximum of the day and the figure above which it traded this Wednesday. As detailed by the security area of
Gensler has repeatedly argued that the crypto world is rife with fraud and misconduct. The agency took measures against the sector after the collapse of FTX, led by Sam Bankman-Fried, today in prison.
This Wednesday is in any case a key day. The final and official decision is expected to be known throughout the day, as it is the deadline for the regulator to rule on the ETFs registered by Ark Investments and 21Shares. There are another dozen waiting, including some from BlacRock or Fidelity.
As a great advantage, an ETF would provide more security to the investment. With the approval, the doors are opened to the entry of large investors, until now wary of investment, and their money, such as private banks, pension funds, hedge funds, international firms… More investment would mean more demand and boost valuations. Bitcoin was the asset that achieved the best performance in 2023.