SEC will classify ETH as security and reject spot Ethereum ETFs, says Michael Saylor


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Michael Saylor believes that the US Securities and Exchange Commission (SEC) will label Ethereum as a security this summer and consequently deny all spot Ethereum ETF applications. He also claimed that other major cryptos like Binance Coin (BNB), Solana (SOL), Ripple (XRP), and Cardano (ADA) will likely face similar security classifications from the SEC.

“Ethereum is deemed to be a crypto asset security, not a commodity. After that, you’re gonna see that Ethereum, BNB, Solana, Ripple, Cardano, everything down the stack is just crypto-asset securities unregistered,” said Saylor during today’s presentation at the MicroStrategy World 2024 conference.

“None of them will ever be wrapped by a spot ETF. None of them will be accepted by Wall Street. None of them will be accepted by mainstream institutional investors as crypto assets,” he added.

In contrast, Saylor highlighted Bitcoin’s unique position as the only crypto asset with full institutional acceptance, describing it as the “one universal” institutional-grade crypto asset without any contenders.

MicroStrategy’s founder is known as a vocal Bitcoin proponent; he exclusively focuses on Bitcoin investment and building Bitcoin infrastructure.

Saylor’s comments come a day after MicroStrategy unveiled MicroStrategy Orange, a Bitcoin-based decentralized identity solution. Earlier this week, the company also announced its acquisition of 122 BTC last month.

Mounting skepticism

Saylor is not the only person who is skeptical about the near-term approval of spot Ethereum ETFs. Justin Sun, the founder of TRON Foundation, previously voiced concerns about Ethereum ETF’s regulatory hurdles. He believes the SEC will not approve spot Ethereum ETFs this month.

The SEC is set to make decisions on filings by VanEck and ARK on May 23 and May 24, respectively. Recent discussions surrounding the SEC’s approval process for spot Bitcoin funds have been notably shallow compared to prior discussions preceding the SEC’s approval of spot Bitcoin funds, with SEC staff reportedly not engaging in detailed conversations about the proposed Ethereum ETFs.

This lack of interaction heightens frustration and raises the chances of either a rejection or a postponement of decisions.

A definitive classification for Ethereum could clarify how companies interact with the asset. It could also influence the SEC’s approval of products like spot ETFs and the willingness of companies to engage with Ethereum.

However, not everyone shares this doubt. BlackRock CEO Larry Fink said on the Fox Business show “The Claman Countdown” that a spot Ethereum ETF could still be possible even if the SEC classifies ETH as a security.

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