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The founder of the cryptocurrency project Tron, Justin Sun, will pay $10 million to settle a lawsuit filed by the U.S. Securities and Exchange Commission (SEC). The regulator accused the entrepreneur of market manipulation involving the crypto assets TRX and BitTorrent Token (BTT), as well as violations of securities laws.
The lawsuit was initiated by the SEC in 2023 under the leadership of former chairman Gary Gensler. The case involved entities associated with Tron: Tron Foundation, BitTorrent Foundation, and Rainberry. The regulator claimed that these organizations were engaged in the sale of unregistered securities.
According to the SEC, Sun was also involved in sham trading of TRX. Additionally, the agency alleged that the entrepreneur compensated celebrities for promoting BTT, including rapper Akon, actress Lindsay Lohan, and boxer Jake Paul.
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The regulator has now concluded a three-year investigation. The SEC clarified that Sun and the related companies did not admit or deny the allegations; however, following the payment of the fine, the claims against them will be dismissed. Rainberry has agreed to pay $10 million as part of the settlement agreement.
“The termination of the prosecution puts an end to this matter. I will continue to foster innovation in the United States and globally. I look forward to collaborating with the SEC on developing regulatory guidelines and rules for cryptocurrency operations in the future,” Sun stated on the social media platform X.
The SEC’s decision to close the case has also drawn criticism from some Democratic lawmakers, including Maxine Waters, Richie Torres, and Stephen Lynch. They suggest that the closure may be linked to Sun’s financial connections with cryptocurrency projects associated with former U.S. President Donald Trump. Previously, the entrepreneur spent $30 million on purchasing tokens from the World Liberty Financial platform, which is connected to Trump’s family.
Democrats have called for a more thorough examination of the circumstances surrounding the settlement and urged the SEC to reopen the case against the founder of Tron.
Shortly before the settlement was reached, Maxine Waters demanded that current SEC Chairman Paul Atkins explain the reasons for the suspension of the investigation against Sun, which lasted approximately 11 months. However, the head of the regulator did not provide specific clarifications.
