SEC allows stock exchange-traded Bitcoin funds (ETF) – this false report caused a stir on Wall Street most recently.

The ETF listing of cryptocurrencies is considered a major milestone for the entire industry, but has not yet become a reality. The false report, which was circulated on Tuesday evening, originated from a post on X, formerly Twitter, which the official account of the US Securities and Exchange Commission (SEC) is said to have posted. The news was later deleted.

Hacked account causes Bitcoin price to jump. It is now clear that the account was hacked and the hype around Bitcoin ETFs was nothing but smoke and mirrors. Nevertheless, the news cost some investors dearly. The Bitcoin price briefly jumped to around $47,900 and then fell back significantly. It was only at the beginning of January that the cryptocurrency crossed the $45,000 threshold again – for the first time since April 2022.

The business with crypto coins has always been a double-edged sword. Fans are in a gold rush mood. With the right timing and a bit of luck, a lot of money can be made in a very short time. Critics not only criticize the devastating environmental impact – mining a Bitcoin consumes an immense amount of energy – but also the high volatility of the digital currency. Not only can criminal users conceal financial transactions, but normal investors also run the risk of losing a lot of money very quickly – if the timing and luck don’t work out.

Bitcoin fluctuations: Easy come, easy go. The recent incident is just one example in a long series of similar reports that illustrate how much Bitcoin – which has practically no physical value – reacts to news and how short-term and volatile trading is.

In the past, tweets from Elon Musk, among others, have caused massive price movements in Bitcoin. The Tesla CEO and current owner of Twitter or X was able to move the price almost at will with just a few lines, which has repeatedly gotten Musk in trouble with the SEC.

Musk vs. SEC: Confrontation with tradition. In the current case, there are mutual accusations of blame: the SEC complains about a lack of data security on X. Musk counters that the agency did not protect their account with two-factor authentication, which has been available on the platform for a year for a fee. This makes it much more difficult for someone outside to hack into the account.

At a higher level, there is a fundamental problem. Since the famous „blue checkmark“ no longer stands for verified authenticity, but is available to any paying customer of X, the platform is much more vulnerable to abuse and false reports than it already was before. Even in the past, there have been problems with hacked accounts and untrue reports, and since the takeover by Musk, the situation has only worsened.

Behind the recent hack could be a simple market manipulation: whoever drove up the Bitcoin price with the false report presumably cashed in parallel in the background.