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Unauthorized SEC Tweet Causes Market Volatility and Raises Regulatory Concerns

Key Takeaways

An unauthorized tweet from the official U.S. Securities and Exchange Commission (SEC) handle claiming that spot Bitcoin ETFs had been approved caused significant volatility in cryptocurrency markets before it was deleted. The mishap raised concerns from crypto leaders about the SEC’s competence and accountability.

Reaction from Crypto Leaders

Tyler Winklevoss of Gemini called for the SEC to “hold itself accountable” via his Twitter account. Ripple CEO Brad Garlinghouse suggested the SEC “investigate itself” and commented on “crypto Twitter.” MicroStrategy CEO Michael Saylor remarked on the false tweet’s “irony” and potential impact on SEC credibility.

Coinbase’s Chief Legal Officer Paul Grewal expressed frustration via Twitter, hinting at Coinbase’s legal issues with the SEC. Coinbase seeks clarity from the SEC on crypto regulations, especially regarding custody services for bitcoin ETFs.

Nate Geraci, president of The ETF Store, called the incident “a significant and unexpected twist” in the effort to launch a spot bitcoin ETF. SkyBridge Capital’s Anthony Scaramucci hypothesized that the SEC’s tweet might have been a premature release rather than a hack.

Criticism and Calls for Accountability

Critics highlighted previous SEC warnings about misinformation on the internet and Chairman Gary Gensler’s advice on financial account security. U.S. Senators J.D. Vance and Thom Tillis contacted SEC Chair Gary Gensler, requesting a report to Congress and a review of the SEC’s cybersecurity practices.

Vance and Tillis described the incident as “a contradiction” to the SEC’s mission of “protecting investors and maintaining market integrity.”

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