SEC files suit against Justin Sun

The U.S. Securities and Exchange Commission (SEC) has charged Tron founder Justin Sun and three of his companies with an unregistered offer and sale of crypto asset securities in the form of Tronix (TRX) and BitTorrent (BTT).

Today we charged crypto entrepreneur Justin Sun and three of his wholly-owned companies for the unregistered offer and sale of crypto asset securities Tronix and BitTorrent.

Read more:https://t.co/4tXgKNof6Q

— U.S. Securities and Exchange Commission (@SECGov) March 22, 2023

The regulator also alleges that Sun and the TRON Foundation, BitTorrent Foundation and Rainberry (formerly BitTorrent) manipulated the secondary market for TRX via wash trading.

According to the complaint, the defendants enlisted a number of celebrities to promote the assets for undisclosed compensation. In this regard, the SEC charged the following with unlawful promotion of TRX and/or BTT:

• actress Lindsay Lohan;
• vlogger Jake Paul;
• rappers Akon (Alian Tiam) and Soulja Boy (Deandre Cortez Way);
• singers Austin Mahone and Ne-Yo;
• porn star Kendra Lust (Michele Mason);
• hip-hop artist Lil Yachty (Miles Parks McCollum).

Except for Mahone and Soulja Boy, they agreed to settle the claims by paying $400,000 in restitution, penalties and interest, without admitting or denying the Commission’s findings.

The Commission filed a civil complaint in the Southern District of New York.

Justin Sun called the allegations unfounded. He noted that the SEC’s regulatory framework for digital assets is still in its infancy.

The SEC’s civil complaint earlier today is just the latest example of actions it has taken against well known players in the blockchain and crypto space. We believe the complaint lacks merit, and in the meantime will continue building the most decentralized financial system.

— H.E. Justin Sun 孙宇晨 (@justinsuntron) March 23, 2023

In the last 24 hours, the price of TRX has fallen 7.4%. The token trades at around $0.06 and, with a market cap of about $5.7 billion, is ranked 16th by market cap (CoinGecko).

In March, it was reported that the SEC issued subpoenas to the head of the DEX SushiSwap, Jared Grey, and the decentralized autonomous organization Sushi DAO.