The US Securities and Exchange Commission (SEC) was faced with a significant cybersecurity breach. It also raised concerns about the security of social media accounts. The incident came to light on January 9, 2024, when an unauthorized entity gained access to @SECGov, the SEC’s official X.com (formerly Twitter) account, through a breach that included the relevant phone number. The breach ended with a false announcement regarding the approval of spot Bitcoin exchange-traded funds (ETFs). Thus, it caused turmoil in the cryptocurrency community.
Bitcoin ETF post and timeline of events
The unauthorized posts occurred on the @SECGov account at approximately 4:11 ET. The posts claimed that the SEC had approved Bitcoin ETFs. Then there was an encrypted post that said “BTC” and they later deleted it. In his official statement, SEC Chairman Gary Gensler emphasized that the institution did not make such an approval announcement. He then detailed the course of events. Upon detection of the breach, SEC staff took swift action to mitigate the impact. As of 4:26 PM ET, Gensler’s separate account @garygensler on X.com announced that the @SECGov account had been compromised. The unauthorized post was removed and likes were withdrawn from two liked posts. A new statement confirming the danger was published at 16:42. The unauthorized access was successfully terminated between 16:40 and 17:30 in cooperation with X.com.
Following the Bitcoin ETF post, the SEC actively worked with law enforcement and federal oversight agencies, including the Federal Bureau of Investigation (FBI) and the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency (CISA). The aim was to understand the source of the breach and evaluate the full scope of the incident. It also means implementing measures to prevent future events. Despite the breach, Gensler emphasized that there was no evidence of access to other SEC systems, data or devices. The SEC is committed to its cybersecurity obligations and is evaluating the impact of the incident on the institution, investors, and the market.
Lawmakers are worried
Gensler reassured the public that official SEC actions against assets such as Bitcoin are made public on the Commission’s website and that social media is used only to amplify website announcements. The cybersecurity breach prompted lawmakers, including Senators Ron Wyden and Cynthia Lummis, to call for a comprehensive investigation into the incident and the SEC’s cybersecurity practices. Senators cited potential financial losses. They also expressed concern about the broader impact of such breaches on public markets.
While investigations are ongoing, the SEC remains vigilant in addressing cybersecurity issues. This incident shows the importance of ensuring the security of social media accounts. It also serves as a stark reminder of the potential impact such breaches can have on Bitcoin markets. Investors and the public await further developments as the SEC works to ensure the integrity and security of its systems.
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