In the 7 years since its launch, Twitter has become arguably the most important form of social media for business.
￼Allowing for near-instantaneous sharing of information condensed to its most salient points, for high-intensity industries such as financial services the platform is rapidly becoming an invaluable tool, used in complex algorithms to dispense market tips that can give traders the split-second edge they rely on. But that speed comes at a cost.
When an errant Tweet can disperse around the globe within seconds, as happens disturbingly frequently despite this generation’s apparent web-savviness, it can cause massive disruption. Such was the case on April 23 last year, when the Twitter feed of the Associated Press (3 million + followers as of today) was hacked and the following message displayed:
Breaking: 2 Explosions in the White House and Barack Obama is injured
While the report was quickly rubbished by officials and other news outlets, it nevertheless had a seismic impact. Global markets went into a panicked freefall. In the 2 minutes between 1.08pm and 1.10pm, the Dow Jones dropped by over 140 points (it sprang back level within 6 minutes), and the S&P 500 Index lost in the region of $136 billion.
Responsibility for the hack was claimed by the Syrian Electronic Army, a pro-regime group that have made several other, less high-profile cyber-attacks. They had reportedly been attempting to steal passwords from AP journalists in the days previous.
Blame began to be cast around – at the Associated Press for not having a more secure password; at Twitter for not having a two-step verification process which might have prevented or at least stalled the hack, and at traders themselves for their credibility and reliance on a fallible resource. There was consternation at the highest levels: at the SEC, in congress, among law officials. The prevailing feeling was one of shock at the pace of the incident – it was over almost before it began, with few having time to react.
Whilst the obvious damage caused is clear, the AP hack also brought into question the security of high-intensity trading, and highlighted the sensitivity of markets to questionable news reports over social media. As these platforms become more important to the financial services industry, dashboards aggregating data customised to traders’ relevant needs will help businesses make trading decisions and become commonplace.