The Securities and Exchange Commission (SEC) has dismissed the fraud case against Justin Sun and his companies, Tron Foundation and BitTorrent Foundation.
According to court filings, the SEC seeks a settlement in which the crypto billionaire will pay a $10 million civil penalty for violating federal securities law.
The remaining claims against Sun and his companies will be dismissed with prejudice, meaning they cannot be brought back or refiled in the future.
In a separate social media post, Sun confirmed the dismissal of the case, noting that it brought ‘closure’ and will make the future bright.
“Today’s resolution brings closure...The future is bright.”
Unpacking Sun vs. SEC lawsuit
The regulator sued Sun alongside his firms, Tron Foundation, BitTorrent Foundation, and Rainberry in early 2023.
At that time, the SEC claimed that Sun and his firms manipulated the markets for Tron [TRX] and BitTorrent (BTT). Additionally, the Garry Gensler-led SEC alleged that the two tokens were sold as unregistered crypto securities, in violation of federal securities laws.
Even celebrities used in the promotion of the tokens were implicated in the case. According to the SEC, Sun generated over $31 million in illegal proceeds from the alleged fraudulent schemes.
However, like most SEC enforcement actions, Sun’s lawsuit was paused after Donald Trump became U.S President in early 2025.
To achieve his vision of making the U.S. the crypto capital of the world, the Trump Administration rolled back most prior SEC enforcement actions.
Sun will join the long list of founders and crypto firms that have either entered a settlement agreement or had their lawsuit dismissed altogether.
Reactions to Justin Sun-SEC deal
But the move has also attracted criticism. Sun is one of the notable investors in World Liberty Financial, a crypto firm backed by the Trump family. As such, critics viewed the dismissal as a ‘pay-to-play.’
In fact, in a statement, ranking Democratic Senator Elizabeth Warren warned the SEC from being used to do Trump’s bidding.
“The SEC should not be a lap dog for Trump’s billionaire buddies.”
For her part, Amanda Fischer, a former chief of staff at the Gensle-led SEC, called the Sun settlement deal an “embarrassment to the agency and the crypto industry.”
That said, the TRX price did not react to the update as of the time of writing. The altcoin traded at $0.28 after dropping lower on the 5th of March, following Bitcoin’s slight retracement.
Final Summary
- The SEC ended the fraud case against Justin Sun and his firms with a $10M settlement.
- Sun hailed the move, but Senator Warren criticized the deal, warning the SEC against being a Trump lapdog.
