SEC calls in FBI to probe account breach amid market manipulation fears

The US Securities and Exchange Commission (SEC) has called in the Federal Bureau of Investigation (FBI) to investigate the recent hack on its social media account, just hours before the crucial announcement on the approval of spot Bitcoin ETFs.

The incident raised concerns about the potential impact of misinformation on the cryptocurrency market, emphasizing the importance of thorough research before making investment decisions.

SEC and FBI collaboration

The SEC found itself in the midst of a cybersecurity storm when a false post appeared on its social media account, asserting the approval of spot Bitcoin ETFs on registered securities exchanges. This misleading announcement, timed strategically just before the anticipated decision on a spot Bitcoin ETF, triggered market confusion and prompted the SEC to enlist the FBI’s expertise.

The SEC, however, promptly addressed the issue through its X (formerly Twitter) account, clarifying that no such approval had been granted.

The breach, attributed to unauthorized access to a phone number linked to the SEC’s account, has sparked concerns about the agency’s digital security measures. A conversation between Elon Musk and Gary Gensler has since surfaced showing Musk highlighting that the SEC probably forgot to activate 2FA on the SEC account.

The SEC Chair Gary Gensler had earlier given a warning to cryptocurrency investors stating that “if you’re considering an investment involving crypto assets, be cautious,” and that “crypto asset securities may be marketed as new opportunities but there are serious risks involved.”

Market manipulation fears

Lawmakers, including Representative French Hill and Senator Cynthia Lummis, have expressed their apprehension. Representative Hill termed the incident a significant technological vulnerability, and Senator Lummis highlighted potential market manipulation implications.

Although Gensler has confirmed an ongoing investigation, emphasizing collaboration with the FBI and the SEC’s Office of the Inspector General, the fallout from the breach underscores the need for robust security protocols in official communication channels in the digital age. The incident also serves as a stark reminder of the importance of verifying information before making investment decisions.

Cryptocurrency newcomers and enthusiasts alike should exercise caution and conduct thorough research through educational content, insights, and guidance, said CryptoManiaks.com, as it guides individuals through the complexities of crypto investing.

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