The U.S. Securities and Exchange Commission has filed a motion to settle its long-running fraud case against Justin Sun, the founder of the Tron blockchain and owner of BitTorrent, for a $10 million penalty.
The proposed settlement, filed in federal court, would resolve charges the SEC brought against Sun in March 2023. Regulators had accused him of orchestrating a scheme to artificially inflate trading volumes for Tron’s native token, TRX, and BitTorrent’s token, BTT, through wash trading. The SEC also alleged Sun paid celebrities to promote those assets without disclosing they were being compensated.
What the Settlement Covers
The $10 million figure represents the penalty component of the agreement. The full terms of the settlement, including any disgorgement of profits, have not been fully detailed in publicly available filings. The motion signals both parties have reached a resolution that avoids a full trial.
Sun had previously denied the SEC’s allegations. His legal team argued the regulator lacked jurisdiction over token sales conducted largely outside the United States.
A Shift in the SEC’s Crypto Posture
The move fits a broader pattern. Under current SEC leadership, the agency has stepped back from several high-profile crypto enforcement actions, negotiating settlements rather than pressing cases to judgment. The commission dropped or paused suits against a number of major crypto firms earlier this year.
Sun’s case had attracted particular attention given his public profile and the scale of the alleged manipulation. The SEC’s original complaint named him alongside several celebrities, including actress Lindsay Lohan and musician Akon, who separately settled their portions of the case for smaller amounts without admitting wrongdoing.
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Sun’s Broader Legal and Political Exposure
The SEC case was never Sun’s only regulatory concern. He has also faced scrutiny from the U.S. Department of Justice, which reportedly opened a separate investigation into Tron-linked entities. That inquiry remains independent of this settlement.
Sun has positioned himself as a significant figure in crypto’s growing political orbit in the United States. He became one of the largest known holders of World Liberty Financial tokens, a crypto project publicly associated with the Trump family, investing $75 million. That relationship drew additional scrutiny from lawmakers who questioned whether large purchases of politically connected crypto assets created conflicts of interest for federal regulators handling his case.
TRX traded at $0.285525 at the time of publication, up 0.85% on the day, making it one of the few major tokens in positive territory during a broader market pullback. BTT traded at $0.00000033, down 4.47%.
What Comes Next
A federal judge must approve the proposed settlement before it takes effect. If approved, it would formally close the SEC’s civil case against Sun, though it would carry no admission of liability. The DOJ inquiry would continue on its own timeline, separate from today’s civil resolution.
Disclaimer: The information provided in this article is for educational and informational purposes only and does not constitute financial or investment advice.
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