Prosecutors expected to offer plea deal to alleged SEC hacker who falsely said Bitcoin ETFs were approved

U.S. prosecutors are preparing to offer a plea deal to an Alabama man accused of hacking a U.S. Securities and Exchange Commission social media account. In January, the SEC's X account posted a fake announcement about spot bitcoin funds being approved prior to the agency's official announcement.

During a hearing at the U.S. District Court in the District of Columbia on Friday, assistant U.S. attorney Kevin Rosenberg said they planned to "extend a plea," but did not know if it would be accepted, according to reporting from Bloomberg .

The man allegedly behind the hack, Eric Council Jr., 25, was arrested and charged last week with "conspiracy to commit aggravated identity theft and access device fraud." Council has pleaded not guilty, according to the court docket.

The SEC's X account was compromised in January ahead of spot bitcoin ETFs being approved by the agency. Prosecutors said Council worked with others to take control of the SEC's X account when a post went out that said, "Today the SEC grants approval for #Bitcoin ETFs for listing on all registered national securities exchanges." Both SEC Chair Gary Gensler and X quickly confirmed afterward the account had been compromised.

After sending the post, the price of bitcoin increased by more than $1,000, according to prosecutors' previous statement. The fake tweet went out a day before the SEC formally approved the much-anticipated spot bitcoin ETFs, which have since brought in billions of dollars.

Council allegedly acquired personal identifying information including a victim's name and photo from his co-conspirators and then created a fake ID and got a SIM card linked to the victim's phone line by using that fake ID at an AT&T store in Huntsville, Alabama. He then used a new iPhone, which he bought using cash, and used what he had to get access codes to the SEC's X account, prosecutors said previously.

The case is in front of Judge Amy Berman Jackson, who is also overseeing a case brought by the SEC against Binance. If prosecutors and Council are able to reach an agreement, they both have to submit "copies of any proposed plea paperwork" by Dec. 4, according to the court docket.