Bitcoin Prices Spike After SEC X Account Hack

Yesterday, the US Securities and Exchange Commission's (SEC) account on X, formerly known as Twitter, was compromised by an unknown actor, leading the SEC to launch an investigation alongside law enforcement.

On Jan. 9, hackers gained control of the account and posted a message on the agency's social media page stating that it had approved exchange traded funds (ETFs), which was false. The post received more than 1 million views even though was deleted less than 20 minutes later.

X confirmed the hack, stating that it was at the hands of an "unidentified individual" who managed to gain access to a phone number associated with the X account. The attack is the latest in a string of high-value X account compromises.

"We can confirm that the account @SECGov was compromised and we have completed a preliminary investigation. Based on our investigation, the compromise was not due to any breach of X's systems, but rather due to an unidentified individual obtaining control over a phone number associated with the @SECGov account through a third party," the X Safety account stated. It also noted that two-factor authentication was not enabled when the account was compromised. 

The price of Bitcoin rose by about 5% after the post went up on the social media website, as the SEC actually is expected to make some influential decisions regarding ETFs on Jan. 10.

"While this incident appears to be contained, it demonstrates the impact of compromised social media accounts, particularly when such a highly influential entity is involved. By all appearances, the unauthorized message was flagged almost immediately, which prevented broader fallout," stated Darren James, a senior product manager at Specops Software, an Outpost24 company, in an emailed statement. "But with the investment community awaiting the agency's announcement regarding Bitcoin, millions of dollars could have potentially been transacted on fraudulent information."