Crypto Enthusiasts Accuse SEC Of ‘Manipulating’ BTC Market Following Provocative ETF Tweet

Lawmakers and cryptocurrency advocates raise concerns regarding the compromise of the SEC’s X account (previously Twitter), resulting in a misleading tweet on Tuesday.

Almost seven years ago, the Securities and Exchange Commission (SEC) rejected the initial spot bitcoin exchange-traded fund (ETF) application, highlighting investor risk due to market manipulation. This reasoning became a recurring theme in the numerous subsequent rejections.

The regulatory body needs to provide an explanation.

The false tweet on Tuesday from the SEC’s X official account (previously Twitter) led to a swift surge and subsequent drop in Bitcoin’s price, triggering confusion among traders over the apparent endorsement. It seemed as if the influential regulator had suddenly approved all potential BTC ETF applications, granting bitcoin speculators the anticipated win a day earlier than expected.

Naturally, the questionable post—accompanied by a $BTC cashtag—turned out to be a hoax. Chair Gary Gensler promptly tweeted from his personal account, clarifying that the SEC hadn’t approved anything. Bitcoin markets persisted in their sell-off as a reaction.

The entire episode sparked demands for an inquiry from cryptocurrency-supporting legislators and infuriated social media users, questioning how the SEC permitted itself to disseminate misinformation.

“Fraudulent announcements, like the one that was made on the SEC’s social media, can manipulate markets. We need transparency on what happened,” tweeted Senator Cynthia Lummis (R-Wy.) after the SEC confirmed its account has been “compromised.”

It was an unexpected turn in what many believed to be the SEC’s ultimate resistance to the spot bitcoin ETF.

The SEC’s prior remarks set the stage for traders to overreact to such false information. In mid-October, the regulator tweeted, “Be cautious of online information. The most reliable source for SEC updates is the SEC,” addressing a retracted CoinTelegraph tweet claiming BlackRock’s bitcoin ETF application approval.

While the initial segment of the tweet sustained its credibility on Tuesday, the latter portion turned into a mockery. As several analysts highlighted, even the SEC’s own statements aren’t entirely reliable for insights within the SEC.

Just the previous week, an SEC representative informed CoinNerd that all decisions would initially appear on their internal EDGAR database. However, both the public and well-informed observers disregarded this guidance on Tuesday.

“Does this mean we can blame more of the @secgov’s horrible rulemaking and so-called regulation by enforcement on a ‘compromised account’?, tweeted Rep. Bill Huizenga in response to Gensler.

Beyond the ironic amusement, the SEC’s seemingly compromised account sparked concerning inquiries regarding the regulator’s dedication to safeguarding itself to ensure investor protection (although the method of compromise for the X account remains unclear).

“The SEC will work with law enforcement and our partners across government to investigate the matter and determine appropriate next steps relating to both the unauthorized access and any related misconduct,” the regulator said hours into the episode.

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