In a surprising turn of events the U.S. SEC encountered a significant cybersecurity attack as its official X account, @SECgov was hacked. The incident happened unexpectedly on January 9, creating ripples in the financial space and prompting calls for immediate investigation and accountability.

The U.S. Securities and Exchange Commission, SEC has gone ahead to clarify that it has not endorsed Bitcoin ETF applications, contradicting an earlier brief statement on its X (formerly twitter) account suggesting otherwise. The regulator stated on January 9 that its X (formerly twitter) account was breeched, resulting in a misleading tweet implying the approval of Bitcoin ETFs in the united states. The inaccurate tweet remained posted for around 20 minutes before being removed.

The breeched @SECgov X account posted a tweet stating:

“Today, the SEC approves #Bitcoin ETFs for listing on all registered national securities exchanges. Approved ETFs will undergo continuous surveillance and compliance measures for ongoing investor protection.”

The tweet featured a graphic with an alleged quote from the SEC Chair, Gary Gensler. Additionally, a second tweet which was posted to the account that stated “$BTC” was immediately deleted shortly after being posted.

Gary Gensler also took to his own account stating that the ETFs have not been authorized.

“The SEC has not approved the listing and trading of spot bitcoin exchange-traded products,” he said.

In the early hours of Wednesday morning UTC, X’s Safety team reported that the SECgov account lacked two-factor authentication at the time of the attack, allowing the intruder to take control by exploiting a phone number linked to the SECgov account.

In a subsequent announcement, a SEC representative mentioned that the account experienced unauthorized access and activity from an unidentified source. In his statement, the representative confirmed that the unauthorized access has been revoked, and the party no longer has control. The Statement also confirmed that the SEC will collaborate with law enforcement and governmental partners to probe the issue and decide on suitable actions concerning both the unauthorized access and any associated misconduct.

Several United States Lawyers and Senators have placed a demand on congress to initiate an investigation into the securities regulator following the recent market threatening incident. U.S. Senator Bill Hagerty emphasized the need for accountability, likening the situation to the SEC’s expectations from the public companies for significant market-impacting errors.

Senator Cynthia Lummis similarly called on the SEC to provide transparency regarding the circumstances surrounding the inaccurate post.

“Fraudulent announcements, like the one that was made on the SEC’s social media, can manipulate the markets. We need transparency on what happened.” She tweeted in recent post.

Senators JD Vance and Thom Tillis also addressed a letter to Gensler expressing concern and seeking clarity on the SEC’s social media communications. They raised serious concerns about the incident, emphasizing the need for clarification on the SEC’s cybersecurity measures and demanded an explanation on the regulators plans to investigate the error.

Vance and Tillis stated that the false SEC announcement and its subsequent correction caused “significant fluctuations in Bitcoin’s price”, leaving investors in a “state of confusion” by the regulator’s communication on the much anticipated and impactful decision.

Following the post, Bitcoin (BTC) initially surged to almost $48,000 but has subsequently experienced a nearly 6% drop to $45,100 when the information was turned out to be false.

There is a global anticipation that the regulator will grant approval for spot bitcoin ETF applications on Wednesday. According to an SEC representative, who confirmed that any approval for bitcoin ETFs will be documented in the agency’s EDGAR database. The representative emphasized that communication of decisions will be done through the commission’s website and any other publication in the federal register, with no mention of X as a means of communication for the decision.