The SEC and Justin Sun, founder of Tron, are working towards settling a civil fraud lawsuit against him. Both parties have requested a stay order to pause the legal proceedings.
This lawsuit involves allegations of unregistered sales of TRX and BTT, market manipulation, and undisclosed celebrity endorsements. The SEC has recently been resolving several crypto-related lawsuits, indicating a possible shift in its enforcement strategy.
In a recent court filing, the SEC and Sun asked the Southern District Court of New York for a stay order. This order would temporarily halt any further actions in the case.
Their request suggests they are aiming for a settlement, which could lead to the dismissal of the lawsuit. While details of the settlement are unclear, it may involve penalties for Sun.
This case is part of a larger trend where the SEC has dropped lawsuits against various crypto firms. Recently, the SEC concluded its lawsuit against Coinbase and closed investigations into Uniswap and Robinhood. The SEC appears to be moving towards resolving significant cases, including that against Justin Sun.
In March 2023, the SEC filed charges against Sun and his companies, alleging unregistered sales of crypto asset securities. The SEC accused Sun of manipulating the TRX market through wash trading. Additionally, it was revealed that Sun paid celebrities to promote TRX and BTT without disclosing their compensation, violating securities regulations.
Sun’s legal team argued that the SEC lacked jurisdiction, claiming the activities occurred outside the U.S. However, the SEC amended its complaint in April 2024, showing that Sun had significant connections to the U.S. In October 2024, a U.S. District Court rejected a request to dismiss a class-action lawsuit from TRX investors, complicating Sun’s legal issues.
Overall, the SEC’s actions indicate a readiness to settle cases against major crypto figures. This shift may lead to a more pragmatic approach to crypto regulation, moving away from aggressive litigation. The outcome of Sun’s case could set important precedents for future crypto-related legal matters.
