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Justin Sun Predicts SEC May Not Approve Ethereum ETF in May

Tron blockchain founder Justin Sun recently made a prediction that the US Securities and Exchange Commission (SEC) would not approve an Ethereum exchange-traded fund (ETF) in May. In a tweet on April 28, Sun emphasized the importance of educating regulators about the intricacies of the crypto industry, suggesting that more work needs to be done in this area.

“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.

This perspective aligns with the viewpoints of various market analysts who are anticipating the rejection of pending Ethereum ETF applications by the SEC. Bloomberg ETF analyst Eric Balchunas, for example, has expressed skepticism about the SEC approving a spot Ethereum ETF in May, giving it a low probability of 25%. This lack of optimism is attributed to the SEC’s relatively passive stance in comparison to the Bitcoin ETF application period.

Recent rumors suggest that the SEC, under the leadership of Gary Gensler, is considering classifying Ethereum (ETH) as a security, a development that has led to a lawsuit by Consensys against the Commission. Furthermore, feedback from meetings with the SEC indicates a bleak outlook for ETF approval, with the likelihood decreasing to only 11% according to Polymarket data.

Despite these challenges, some ETF issuers like BlackRock and Grayscale are continuing to update their applications, demonstrating a degree of optimism amidst the uncertainty surrounding approval. Notably, Franklin Templeton’s spot Ethereum ETF application appeared on the DTCC website despite the SEC postponing its decision in April.

Craig Salm, Chief legal Officer at Grayscale, remains positive about the prospects of spot Ethereum ETFs, emphasizing that investors deserve access to Ethereum in this form. He believes that the case for spot Ethereum ETFs is as compelling as it was for spot Bitcoin ETFs.

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