Bitcoin slides after SEC social media account is compromised, sends false ETF approval post

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Standard Chartered predicts bitcoin could fall to $5,000 in 2023 as part of its research on potential market surprises next year.

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The price of bitcoin fell during late afternoon trading Tuesday following a false social media post from the X account of the U.S. Securities and Exchange Commission that stated the agency had approved bitcoin exchange-traded funds for trading.

The SEC later deleted the post and said its account on X was compromised and it had not approved the ETFs.

Bitcoin initially jumped as high as $47,901, its highest level since March 2022, according to Coin Metrics, before dropping to as low as $44,816.94. It was last trading lower by more than 1% at $46,162.79.

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Bitcoin briefly spikes on false report of bitcoin ETF approval

“The sell-off is showing a rattled market,” said Michael Rinko, research analyst at Delphi Digital. “This kind of high-volume boomerang event probably spooked some people and led to people taking some risk off the table, but the initial market reaction is encouraging.”

Investors had expected an update from the SEC as soon as tomorrow, with some hoping the decision would come earlier. Wednesday marks the deadline for the SEC to either approve or deny the Ark 21Shares spot bitcoin ETF application. It is widely believed that the agency will approve several at once.

Bitcoin had traded below the $47,000 level for much of Tuesday, after crossing it one day prior for the first time since April 2022, as updated SEC filings from potential bitcoin ETF issuers bolstered investors’ confidence that an approval is inevitable.

Some investors say the day one effect of an approval has been overestimated and that it could be a sell-the-news event. Bitcoin has advanced about 60% in the past three months, primarily as a result of the ETF hype. Additionally, investors have been sitting on high unrealized profits — a trend that historically precedes price corrections — according to data from CryptoQuant.

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