Justin Sun predicts SEC rejection of Ethereum ETF in May, citing need for crypto education Justin Sun predicts SEC rejection of Ethereum ETF in May, citing need for crypto education
The chances of the SEC approving an Ethereum ETF in May continues to dim amid recent developments.
2 min read
Updated: Apr. 29, 2024 at 9:57 am UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Tron blockchain founder Justin Sun says the US Securities and Exchange Commission (SEC) would not approve an Ethereum exchange-traded fund (ETF) in May.
In an April 28 post on X (formerly Twitter), Sun noted that the crypto industry still needs to prepare for a long-term education with regulators, especially in helping them understand how the emerging industry operates.
“My honest opinion (NFA) is that an Ethereum ETF won’t be approved in May. The crypto industry still needs to prepare for a long-term education with regulators, focusing on helping them understand crypto,” Sun said.
Sun’s stance echoes the sentiments of numerous market analysts anticipating the SEC dismissing the pending Ethereum ETF applications.
For instance, Bloomberg ETF analyst Eric Balchunas placed the chances of the SEC greenlighting a spot Ethereum ETF in May at 25%. He attributed this skepticism to the SEC’s less active involvement in the application process than the Bitcoin ETF period.
Also, recent speculations suggest the Gary Gensler-led agency has initiated efforts to classify ETH as security, prompting the Consensys lawsuit against the Commission.
Additionally, feedback from recent meetings with the SEC indicates a pessimistic outlook, with approval prospects appearing bleak.
These revelations have dwindled the likelihood of an Ethereum ETF approval to 11%, its lowest level this year, as indicated by Polymarket data.
Nevertheless, some optimism persists as ETF issuers like BlackRock and Grayscale continue to update their applications despite the silence and expectation of rejection.
Notably, asset management firm Franklin Templeton’s spot Ethereum ETF appeared on the Depository Trust and Clearing Corporation (DTCC) website despite the SEC deferring its decision on the ETF application on April 23.
Craig Salm, Grayscale’s Chief Legal Officer, said the US SEC’s lack of engagement with spot Ethereum ETF applicants wouldn’t be a decisive factor hindering the prospects of such products.
“Investors want and deserve access to Ethereum in the form of a spot Ethereum ETF and we believe the case is just as strong as it was for spot Bitcoin ETFs,” Salm said.
Mentioned in this article
Ethereum 
TRON 
Franklin Templeton 
Grayscale Investments 
BlackRock 
Justin Sun 
Eric Balchunas 
Gary Gensler Author 
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Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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In this article
Ethereum is a decentralized, open-source blockchain platform that enables the creation of smart contracts and decentralized applications (DApps).
Franklin Templeton
Franklin Resources, Inc., commonly known as Franklin Templeton, stands as an American multinational holding company rooted in the world of finance.
Grayscale Investments
Established in 2013 by Digital Currency Group, Grayscale Investments is a trusted authority on digital currency investing and cryptocurrency asset management.
BlackRock
BlackRock, synonymous with global asset management, is an American multinational investment management corporation based in New York City.
Justin Sun has carved a name for himself as a leading figure in the blockchain sector.
Eric Balchunas is an American author, ETF analyst, and Senior ETF Analyst at Bloomberg Intelligence.
Gary Gensler is an American government official and former investment banker who President Joseph Biden nominated to chair the U.S.