SEC lawyers to investigate market manipulation amid fake news about Bitcoin ETF

January 10, 2024 at 7:23 am

News

Lawyers for the U.S. Securities and Exchange Commission (SEC) are calling for an investigation into possible market manipulation.

In a conversation with Fox Business, SEC lawyers said that the regulator will investigate itself for market manipulation after moving the price of Bitcoin (BTC) up and down on the basis of a fake post published on the SEC’s X account. The price jump occurred after a false message about approving a spot Bitcoin ETF on Jan. 9.

“That said, for the SEC not to approve tomorrow would be unprecedented; it has never rejected ETF applications that have gone as far as these.”
Charles Gasparino, Fox correspondent

BREAKING: Securities lawyers tell @FoxBusiness the @SECGov will have to investigate itself for market manipulation after moving the price of $BTC up and down following the hacked tweet that it had approved the first spot BTC ETF and then saying it was fake. That said, for the SEC…
— Charles Gasparino (@CGasparino) January 9, 2024

American lawyers and senators are also calling for an investigation into the SEC due to false data. In particular, Senator Cynthia Lummis demanded that the SEC provide transparency into the events that led to the now deleted post.

Fraudulent announcements, like the one that was made on the SEC’s social media, can manipulate markets. We need transparency on what happened.
— Senator Cynthia Lummis (@SenLummis) January 9, 2024

Bloomberg ETF analyst James Seyffarth suggested SEC Chairman Gary Gensler will be furious with the employee responsible for the alleged security breach. However, it is not yet known what, or who, caused the fake news post on X.

Bitcoin responded to the publication of the refutation by falling more than 6% to $44,700. At the time of the time of writing, Bitcoin is trading at around $46,000.