Bitcoin steady following fake SEC social media post on ETFs

investmentnews.com:

Bitcoin dropped to around $45,000 before paring losses after a false post on the Securities and Exchange Commission’s X account claimed that the agency had approved the issuance of ETFs holding the digital asset. 

The regulator subsequently said that it had not yet granted approval of spot bitcoin exchange-traded funds and that the X account had been compromised. Market participants were caught offguard by Tuesday’s cybersecurity incident. The SEC is widely expected by analysts to announce a decision about the ETF applications on Wednesday.

Bitcoin traded at $45,900 as of 7:20 a.m. in London on Wednesday. The token had surged to a 21-month high of more than $47,000 on Tuesday as optimism grew that approval of the long-sought ETFs was imminent. 

“I don’t think it will affect the process or what comes next,” said Ophelia Snyder, president of 21Shares, which is seeking to offer a bitcoin ETF with ARK. “There’s no way after 10 years of work this could wrap up without any last-minute drama.”

The ARK 21 Shares application must be addressed by the SEC by the end of Wednesday. Analysts expect approval of several applications at that time, following a slew of last-minute adjustments to official offering statements. 

“Just add this to the long list of surprising plot twists and turns in the 10-plus year effort to bring a spot bitcoin ETF to market,” said Nate Geraci, president of The ETF Store, an advisory firm.

SEC Chair Gary Gensler has repeatedly argued that crypto is rife with fraud and misconduct. The agency cracked down on the sector following a 2022 rout and collapses such as the bankruptcy of Sam Bankman-Fried’s FTX exchange.

But the SEC last year lost a key legal fight against crypto asset manager Grayscale Investments,