A fake post on social media platform X claiming the SEC approved a long-awaited spot Bitcoin exchange-traded fund drove a brief surge in the digital coin’s price on Tuesday.
The market has been awaiting a decision from the SEC on whether it would approve a spot Bitcoin exchange-traded fund (ETF). Currently, the product cannot be sold in the United States.
“It really shows the breadth and frequency of cyberattacks,” Kurt Gottschall, partner at law firm Haynes Boone and former SEC regional director, told Bloomberg. “The irony here is that the SEC has not shown much sympathy to public companies and asset managers that have experienced cybersecurity incidents.”
The SEC said it would work with law enforcement to investigate the incident, understand what occurred, and prevent it from happening again.
Approximately a dozen companies have submitted applications to create spot Bitcoin ETFs in the United States. The SEC identified January 10 as the date it would take action on at least one of the applications.
Before a spot-backed Bitcoin fund can begin trading, the SEC must sign off on the 19b-4 filing by the listing exchanges. The regulator must also approve any related S-1 forms. These are the registration applications from potential issuers, like BlackRock.
The SEC has previously cited concerns about investor protection and potential market manipulation for its decision to restrict the products.
If approved, the new ETFs could begin trading in as quickly as one day.
