A fitting regulator for our circus of an industry.
Yesterday, the SEC’s official Twitter account announced the approval of Bitcoin ETFs, speculation over which has been dominating price action over past weeks.
Markets rejoiced, instantly pumping over $47500.
However, as this is crypto, the since-deleted announcement had been made by a (presumably heavily long) identity thief.
A few minutes later, SEC Chair Gensler (presumably not compromised) clarified:
The @SECGov twitter account was compromised, and an unauthorized tweet was posted. The SEC has not approved the listing and trading of spot bitcoin exchange-traded products.
The damage was sudden, with BTC dumping around 5% in just 15 mins.
The double-whammy and ensuing volatility contributed to over $200M in liquidations between shorts and longs, according to CoinGlass data.
A market-wide pump and dump isn’t the best look for the regulatory body tasked with keeping investors safe.
Careful what you read on the internet. The best source of information about the SEC is the SEC.
The topic of ETF approval has already caused wild swings over recent weeks.
Crypto holders have suffered a lengthy crypto winter and are banking on the long-awaited confirmation that TradFi is coming to buy our bags, speculating heavily on any hints either way.
More recently, last week’s clickbait headline from The Block that ETF applications would be rejected in January was the opinion of a single analyst. Matrixport, the analyst’s employer, had even predicted $50k BTC in January the day before, and the firm’s CEO promptly washed his hands of responsibility for the almost $600M of longs that were wiped out in the accompanying dump.
It’s fair to say that anticipation was running high, and Gensler’s recent capitulation thread made it seem like imminent approval was all but inevitable.
So when the expected info came through, many went for the ‘long first, ask questions later’ approach.
Whether the ETFs are approved today, tomorrow, or down the line, this embarrassing episode has knocked the authority out of the SEC and Gensler’s tough stance on crypto.
If Gary truly wants us to stay safe, he might want to follow his own advice:
Even Coinbase is rubbing salt in the wound.
While it’s (very) easy to laugh at such a karmic self-own, and the SEC itself pumping-and-dumping markets far harder than those they attempt to regulate, there are still people out there who think the crypto community is to blame.
But all degens really care about is whether to buy or sell.
US Senators, on the other hand, aren't so easy to ignore:
Just like the SEC would demand accountability from a public company if they made such a colossal market-moving mistake, Congress needs answers on what just happened. This is unacceptable.
Will the SEC be forced to investigate itself?
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