Lawyers warn: Possible SEC investigation into Elon Musk’s bitcoin tweets
Elon Musk’s Twitter activity could land him in trouble with the SEC, according to some lawyers.
Legal advisors have warned that Tesla CEO Elon Musk could be targeted by the US Securities and Exchange Commission (SEC) over his social media activities and public statements on bitcoin.
On Monday 8 February, Tesla announced in an SEC filing that it had purchased US$1.5 billion worth of Bitcoin and would soon accept BTC payments. Shortly after, the price for the asset shot to a Profit Revolution new all-time high at just over US$48,000.
Doug Davison, a partner at Linklaters and former branch chief of the SEC’s Division of Criminal Prosecutions, told the UK’s Telegraph newspaper:
“It wouldn’t be surprising, given the content of the tweets, the bitcoin price and the recent dramatic market movements, if the SEC is asking questions about the facts and circumstances here.”
Former European Central Bank vice-president Vitor Constâncio echoed this sentiment, saying “the SEC will be looking at this.”
It was not disclosed when Tesla had made this investment. In December, Musk said that Tesla could buy bitcoin, and this was followed by many statements that he supported bitcoin. Bitcoin kept going up & Tesla investment has appreciated. The SEC will look into this 5/
– Vitor Constâncio (@VMRConstancio) February 8, 2021
The SEC and the CFTC regulator have the power to investigate suspected market manipulation.
Musk has spoken out several times on Twitter about Bitcoin and DOGE, which has helped drive Bitcoin activity on the social media platform to all-time highs.
Bitcoin rose 20 percent in late January after Musk mentioned #Bitcoin in his Twitter bio, tweeting, “In hindsight, it was inevitable.” In late December, he posted an explicit meme suggesting he was on the verge of buying Bitcoin.
There is little doubt that Tesla’s publicly disclosed move into Bitcoin has contributed to this recent price spike. Musk’s tweets about crypto may also have moved the markets due to the high number of followers, namely 46.5 million.
Currently he is still supporting Dogecoin, Recently he tweeted that he had bought the asset. DOGE rose 13 percent after that particular tweet.
Bought some Dogecoin for lil X so he can be a toddler hodler
– Elon Musk (@elonmusk) February 10, 2021
Musk has already sparked several Twitter controversies. He has previously been accused of posting misinformation on the platform regarding Covid-19 and the closure of one of its factories.
At one point he also said that Tesla’s share price was too high, which led to a subsequent share price slide. The SEC sued Musk for fraud, accusing the Tesla boss of “false and misleading tweets”. But he soon settled with the regulator.