Bitcoin ETF: Cryptocurrency fluctuates following the "compromised" watchdog X account

A fleeting increase in Bitcoin occurred on Tuesday subsequent to a publication on the X account (previously Twitter) of the US markets regulator, which declared the approval of exchange-traded funds (ETFs) in the cryptocurrency.

Later, the Securities and Exchange Commission (SEC) announced that its account had been "compromised" and removed the post.

The social media platform has stated that no breach of its systems was responsible for the compromised account.

This week, US regulators are anticipated to issue a statement regarding the new ETFs.

The erroneous entry was published on the official X account of the SEC shortly after 16:00 Washington time (21:00 GMT).

The statement states that the listing of #Bitcoin ETFs on all registered national securities exchanges has been approved by the regulator.

The post garnered immediate attention and citation from business news outlets and social media users.

SEC chair Gary Gensler promptly responded to the incorrect announcement on his personal X account with the following message: "Within minutes, an unauthorised tweet was published from the compromised @SECGov Twitter account. The listing and trading of spot bitcoin exchange-traded products have not received approval from the SEC.

"The SEC has determined that an unidentified party gained temporary access to and engaged in activity on the @SECGov account," an SEC spokesperson told the BBC shortly after 4:00 pm ET.

Additionally, they declared that unauthorised access had been revoked. An investigation into the incident will be undertaken by the SEC, in conjunction with law enforcement and government partners, to determine the most appropriate course of action concerning the unauthorised access and any related misconduct.

X announced later on Tuesday that it had concluded a preliminary investigation into the SEC's account and determined that no violation of the social media platform's systems had occurred.

X stated, “We can affirm that the @SECGov account was compromised and have concluded an initial investigation." "The compromise was not the result of a breach of X's systems, but rather an unidentified individual gaining control over a phone number associated with the @SECGov account through a third party," the statement continued.

They also determined that their investigation determined that it was not the case. Additionally, we can verify that two-factor authentication was not enabled on the compromised account at the time of compromise.

Almost immediately following the incorrect post, Bitcoin surged to nearly $48,000 (£37,800) before declining back to around $46,000.

This week, the SEC is expected to make a decision regarding the possible approval of spot bitcoin ETFs, which is eagerly anticipated by investors.

It would represent a significant turning point in the cryptocurrency industry's journey towards acceptance by conventional financial markets.

Multiple asset management firms have submitted SEC approval applications for spot bitcoin ETFs. ETFs are investment portfolios that enable investors to wager on a variety of assets without purchasing any of them.

Similar to stocks, their value is contingent on the real-time performance of the entire portfolio when traded on stock exchanges.

While certain exchange-traded funds (ETFs) indirectly hold Bitcoin, a spot Bitcoin ETF purchases the cryptocurrency "on the spot" at its current price for the duration of the day.