The U.S. Securities and Exchange Commission has dismissed the claims it brought in 2023 against crypto entrepreneur Justin Sun, the Tron Foundation, and the BitTorrent Foundation, ending one of the agency’s most closely watched enforcement actions against a major blockchain figure.
What Happened
A proposed final judgment filed in the U.S. District Court for the Southern District of New York states that the SEC’s claims against Sun, Tron Foundation Limited, and BitTorrent Foundation Ltd. are “dismissed with prejudice,” meaning the allegations cannot be refiled.
Under the agreement, Rainberry Inc., the company behind BitTorrent, will pay a $10 million civil penalty, while the remaining claims against Sun and the associated foundations are dropped.
The settlement effectively concludes a high-profile regulatory case that had accused Sun and his companies of securities violations and market manipulation tied to the promotion and trading of Tron ecosystem tokens.
SEC Ends High-Profile Crypto Enforcement Case
The SEC initially filed the lawsuit in March 2023, alleging that Sun and three entities he controlled, Tron Foundation Limited, BitTorrent Foundation Ltd., and Rainberry Inc., conducted unregistered securities offerings involving the Tronix (TRX) and BitTorrent (BTT) tokens.
According to the regulator’s complaint, Sun and his companies raised millions of dollars through token sales and promotional campaigns that were not registered with the SEC as required under U.S. securities law.
The agency also alleged that the defendants orchestrated large-scale wash trading of TRX to create the appearance of higher market demand and trading activity.
Also Read: Eric Trump Says Bank Lobbyists Spending Millions To Ban Stablecoin Yields The SEC claimed Sun directed employees to execute more than 600,000 wash trades between accounts under his control between 2018 and 2019, with millions of tokens traded daily to inflate reported market volume.
In addition, the regulator accused Sun of paying celebrities—including rapper Soulja Boy and singer Austin Mahone to promote TRX and BTT on social media without disclosing that they were compensated endorsements.
Several celebrities later settled related charges with the SEC without admitting wrongdoing.
Rainberry To Pay $10 Million Penalty
While the settlement dismisses claims against Sun and the Tron and BitTorrent foundations, Rainberry will pay a $10 million civil penalty under the proposed judgment.
The court order also imposed a permanent injunction on Rainberry preventing violations of certain securities fraud provisions related to misleading conduct in the offer or sale of securities.
Rainberry, which operates the BitTorrent protocol and was integrated into the Tron ecosystem following Sun’s 2018 acquisition of BitTorrent, remains subject to the court’s oversight regarding compliance with the settlement terms.
The judgment states that the court will retain jurisdiction over the matter to enforce the terms of the agreement.
The settlement arrives after the case had been paused in 2025 as both sides explored potential resolution options. With the dismissal of claims against Sun and his companies, the litigation is now effectively concluded.
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