SEC Faces Backlash from Crypto Leaders for Erroneous Bitcoin ETF Tweet

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Ruholamin Haqshanas

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Ruholamin Haqshanas

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Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto...

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January 10, 2024 06:34 EST

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The Securities and Exchange Commission (SEC) has found itself in hot water after an unauthorized tweet on its official account suggested that spot Bitcoin exchange-traded funds (ETFs) had been approved. 

The incident, which caused significant volatility in the crypto market, has drawn the ire of crypto leaders. Many traders and investors have expressed their frustrations on social media.

“Today, the @SECGov continued its quest to harm US investors. Time for the SEC to hold the SEC accountable!” Tyler Winklevoss, co-founder of Gemini, tweeted.

He further speculated that the SEC’s enforcement division might receive a Wells Notice from its own enforcement division.

Today, the @SECGov continued its quest to harm US investors. Time for the SEC to hold the SEC accountable!

— Tyler Winklevoss (@tyler) January 9, 2024

Brad Garlinghouse, CEO of Ripple, who has had his own legal battle with the SEC, took a sarcastic tone and suggested that the agency should investigate itself. 

He posted, “Days like this remind me that 1/ the SEC should be investigating itself for multiple things 2/ crypto Twitter remains undefeated in memes.”

Michael Saylor, co-founder of MicroStrategy, commented on the situation by stating, “Bitcoin will be the only thing ever approved twice by the @SECGov.” 

Saylor’s remark highlighted the irony of the false tweet and the potential impact on the perception of the SEC’s credibility.

Coinbase’s Chief Legal Officer Hits Back at SEC

Paul Grewal, Chief Legal Officer of Coinbase, also expressed his frustration at the recent incident.“I’m biting my tongue so hard it’s bleeding…,” Grewal said, alluding to the ongoing legal battle between Coinbase and the SEC. 

Biting my tongue so hard it's bleeding…

— paulgrewal.eth (@iampaulgrewal) January 9, 2024

Coinbase is seeking clarity on how the agency’s rules apply to crypto. This is especially important, as the platform serves as the primary provider of custody services for multiple spot bitcoin ETF applications.

Furthermore, Nate Geraci, president of The ETF Store, called this incident the most twisted plot twist in the entire 10+ year saga of trying to launch a spot bitcoin ETF. 

He described it as “Quentin Tarantino-esque,” emphasizing the unexpected turn of events.

Anthony Scaramucci, former White House communications director and now managing partner at SkyBridge Capital, doubted the idea that the account was hacked. 

He suggested that the tweet might have been a genuine post that was released prematurely. 

However, others countered this theory by noting that it was highly unlikely for the SEC to use the bitcoin hashtag in an official post of such magnitude.

Critics also resurfaced old SEC crypto posts. For example, this one from October warns, “Be careful what you read on the internet. The best source of information about the SEC is the SEC.” 

Additionally, SEC Chairman Gary Gensler’s previous reminders about financial account security gained traction, further adding to the frustration surrounding the false tweet.

As reported, two United States senators, J.D. Vance and Thom Tillis, have raised concerns about the recent breach of the United States Securities and Exchange Commission’s (SEC) X (formerly Twitter) account. 

In a letter addressed to SEC Chair Gary Gensler on the same day as the incident, the senators called for a report to be delivered to Congress regarding the breach. They emphasized the need to evaluate the commission’s internal cybersecurity procedures.

Describing the breach as a matter of serious concern, Vance and Tillis emphasized that it contradicts the SEC’s core mission of protecting investors, maintaining fair markets, and facilitating capital formation.