The Bitcoin market experienced significant volatility due to fake news originating from a compromised X (formerly Twitter) handle, according to Greeks.live, a popular crypto options trading platform. This unexpected event led to a substantial increase in RV, while IV saw a slight decrease.
The market is eagerly awaiting the approval of a spot Bitcoin ETF by the SEC, with investors closely following any announcements from the regulatory body. However, false tweets from the official SEC X handle, erroneously declaring approval for all spot Bitcoin ETFs, caused considerable market turbulence. Greeks.live noted that its data’s logic diverges from the norm as the ETF has been traded for over a month, with a large number of investors betting on it, causing short-term IV to reach a recent peak.
The fake news had a dual impact – it highlighted the limited influence of the ETF on BTC for many investors while also diminishing the already fragile market confidence. As a result, many investors chose to reduce leverage and positions, selling off assets early in response to the news.
When the SEC tweet confirming approval was posted on January 9th, Bitcoin was trading near $46,700. The price surged to $47,400 within one minute and hit a peak of approximately $48,000 just four minutes later. However, the crypto asset swiftly retreated to $46,700 in just one minute, mirroring the price recorded five minutes before the announcement. The price then continued to fall, hitting a low of about $44,750 precisely one minute before Gary Gensler’s tweet. After the revelation of the false news, Bitcoin stabilized within the range of $45,500 to $46,000.
According to Fineqia’s Research Analyst Matteo Greco, the price action analysis confirms that the market movement was a reaction to what was believed to be real news, resulting in a classic “sell-the-news event.” This pattern is typical in the market, where participants buy in the days leading up to a news event and then sell when the news becomes officially public.
Despite being tasked with safeguarding investors, the SEC, which has previously rejected numerous proposals for spot Bitcoin ETFs, found itself at the center of controversy as its own X account was compromised. Initial investigations suggest that the account lacked two-factor authentication (2FA), leading to widespread criticism and mockery directed at the federal agency. Gary Gensler, the agency’s head, had earlier emphasized the importance of securing accounts with 2FA, but the failure to adopt this precautionary measure has subjected the SEC to increased scrutiny.
Following the bizarre event, $66.66 million in longs were liquidated, along with $30.61 million in shorts over the past 12 hours. Two US senators, J.D. Vance and Thom Tillis, have urged the SEC to furnish a report to Congress regarding the January 9 breach of its X account. In a letter to SEC Chair Gary Gensler, the duo expressed “serious concerns” about the internal cybersecurity procedures, deeming the incident contradictory to the SEC’s mission. The senators have requested a report on the breach, citing the need for transparency and referring to a recent cybersecurity disclosure rulemaking.
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | North America |
| Countries | 🇺🇸 |
| Sentiment | negative |
| Relevance Score | 1 |
| People | Gary Gensler, Thom Tillis, Matteo Greco, J.D. Vance |
| Companies | Greeks.live, Binance Futures, Fineqia, CryptoPotato, Securities and Exchange Commission |
| Currencies | Bitcoin |
| Securities | None |
