The SEC has delayed its decision on Trump's Truth Social Bitcoin Ethereum Spot ETF application, as encryption regulation falls into a political whirlwind.

The U.S. Securities and Exchange Commission (SEC) has extended the approval deadline for the Truth Social Bitcoin Ethereum Spot ETF under Trump Media to October 8. Although this move is part of standard procedure, the close association of the applicant, Trump Media Group (TMTG), with President Trump and its family's increasingly expanding crypto portfolio has plunged the approval process into an unprecedented vortex of conflict of interest and political pressure. The SEC is facing a severe test in maintaining market fairness and regulatory independence, leading to widespread concern in the crypto community regarding the transparency of regulatory compliance.

SEC Delays Review Process, Trump ETF Caught in Political Storm

Although the SEC's extension of the review of Truth Social's Bitcoin and Ethereum Spot ETF applications is standard procedure, for a media company that is 52% owned by the sitting president Donald Trump (Trump Media & Technology Group, TMTG) and its family’s growing crypto portfolio, this approval has turned into a high-stakes political balancing act. The SEC cited the need for "sufficient time to consider the proposed rule changes" as a standard reason in its documents, but this does little to mask the unusually strong political undertones behind the application. On August 18, the SEC postponed the deadline for its decision on the Truth Social Bitcoin and Ethereum Spot ETF proposal submitted by NYSE Arca in June to October 8.

Regulatory independence faces unprecedented challenges, account security and financial health become the focus

The SEC's recent delay, while a routine operation regarding crypto asset-related ETFs, carries unusual weight given the fund's connection to Trump's media empire and his family's expansion in the crypto space. The government oversight organization Accountable.US has submitted the only public comment on the case so far, which is harshly worded and strongly urges the SEC to reject the proposal on the grounds of "unprecedented conflicts of interest." The chair of the organization, Caroline Siconne, pointed directly to the core issue: "The SEC must reject this proposed rule change... If the SEC votes to approve the launch of this ETF, it will sow seeds of doubt in the minds of the American public and may undermine confidence in the market and the SEC's own credibility." The submitted comments revealed multiple concerns, including the custodian of the proposed ETF — the Crypto.com subsidiary Foris DAX (Siconne mentioned that there are hundreds of consumer complaints regarding account security and hot wallet storage risks), as well as the fragile financial condition of TMTG itself (with only $821,200 in revenue in the first quarter of 2025, while its market value is as high as $5 billion).

Trump family crypto assets exposed, ETF may become a lifeline for TMTG

The complexity of political factors is exacerbated by Trump's substantial crypto assets financial footprint. According to the Bloomberg Billionaires Index July update, approximately $6.4 billion of Trump's estimated net worth is currently linked to digital assets, with his crypto portfolio composition remaining relatively stable. From decentralized finance (DeFi) projects to branded meme coins, crypto assets have become an important pillar of the Trump family's crypto portfolio. This context has significantly increased the approval risk of the Truth Social spot ETF, which will directly bring the Trump brand into regulated investment instruments linked to Bitcoin and Ethereum. Given that TMTG's stock price has fallen 50% since January 2025, critics believe this spot ETF may become a lifeline for this troubled company directly associated with the president.

The cryptocurrency regulatory framework is quietly shifting, and the SEC's choices have far-reaching impacts.

However, the broader regulatory environment has changed, making the situation more complex. Since Trump took office, the SEC's stance on crypto assets spot ETFs has undergone a significant shift. In July 2025, the SEC approved a rule change allowing crypto ETFs to conduct physical redemptions, paving the way for more complex products, marking a departure from the SEC policies during Biden's administration—when only spot Bitcoin and Ethereum ETFs were approved under a court order. The SEC now faces a decisive choice. Approving the Spot ETF could be seen as favoring the business interests of the sitting president; while rejecting it could invite accusations of political bias. As Siccone stated, "The committee will have to confront these questions: Are they approving the rules because it is the right choice for the country? Or because it would benefit the president's business?"

Conclusion

The SEC's ruling on the Truth Social Bitcoin Ethereum Spot ETF has transcended the realm of mere financial regulation, becoming a touchstone for assessing whether U.S. crypto asset regulatory agencies can maintain their independence and fairness under political pressure. The outcome will not only affect the listing process of specific crypto investment products but will also profoundly shape the market's perception of the credibility of regulatory agencies and the transparency of crypto industry regulation, impacting the nerves of global crypto market participants. Regardless of the final decision, this case will become a key milestone in the history of cryptocurrency regulation in the United States.