Synopsis: SEC drops fraud case against Tron founder Justin Sun after $10M settlement by Rainberry Inc. Original charges: unregistered securities, wash trading, paid celeb promotions. Trump’s pro-crypto SEC shift ends 2-year battle.
The U.S. Securities and Exchange Commission has officially ended its fraud case against crypto billionaire Justin Sun. The Tron founder agreed to a $10 million settlement. This move closes a legal battle that began over two years ago.
Sun founded the Tron blockchain network. He is one of the most high-profile figures in the crypto world. Thursday’s settlement still needs approval from a federal judge before it takes full effect.
A $10 Million Deal to End the Fight
The SEC filed a proposed final judgment in a Manhattan federal court on March 5, 2026. One of Sun’s companies, Rainberry Inc., agreed to pay the $10 million penalty. Importantly, Sun and his companies admitted no wrongdoing. The SEC dropped all claims against Sun personally. It also dismissed charges against the Tron Foundation and BitTorrent Foundation.
As part of the deal, Rainberry agreed to stop future violations of securities laws. The company cannot sell unregistered securities going forward. Sun reacted publicly on X, formerly known as Twitter. “I am pleased to confirm that the SEC has moved to dismiss all claims against me,” he wrote. He added that the resolution “brings closure.”
What the SEC Originally Accused Sun Of
The SEC first sued Sun and his companies in March 2023. The agency made serious accusations against the crypto entrepreneur. First, the SEC claimed Sun sold unregistered securities. It alleged that his tokens, Tronix and BitTorrent, were sold as investment contracts. That violated federal securities laws.
Second, regulators accused Sun of market manipulation. They claimed he directed employees to carry out over 600,000 wash trades. These are trades made with oneself to artificially inflate volume. Sun allegedly did this between April 2018 and February 2019. The goal was to create a false impression of high demand for Tronix.
Third, the SEC accused Sun of illegal celebrity promotion. He reportedly paid celebrities like Lindsay Lohan, Akon, Ne-Yo, and Jake Paul. They promoted his tokens on social media. However, none of them disclosed they were paid to do so. That broke federal disclosure rules. Overall, the agency claimed Sun illegally generated $31 million through these activities.
How Trump’s Return Changed Everything
The case was originally brought under Gary Gensler. He chaired the SEC under former President Joe Biden. Gensler pushed hard for stricter crypto regulation. The industry largely opposed his approach.
However, things shifted after Donald Trump won the 2024 presidential election. Trump took office in January 2025. Shortly after, in February 2025, the SEC paused the Sun case. Officials said they wanted to explore a possible resolution.
Trump has made the U.S. a global crypto hub a key priority. His administration replaced Gensler with Paul Atkins as SEC chairman. Atkins holds a clearly pro-crypto stance. Consequently, several high-profile enforcement cases have been softened or dropped.
Sun’s ties to Trump are also notable. He became one of the biggest buyers of World Liberty Financial. That is a crypto venture linked to the Trump family. Sun invested at least $75 million into the project.
Also Read: Crypto To Become Part of Retirement Funds Starting From 2027
Political Criticism and White House Response
Not everyone welcomed the settlement. Democratic Senator Elizabeth Warren sharply criticized the deal. She sits on the Senate Banking Committee as the top Democrat. “The SEC should not be a lap dog for Trump’s billionaire buddies,” she said in a statement. Her comments reflected broader Democratic concerns about the current direction of crypto enforcement.
The White House pushed back quickly. Spokeswoman Taylor Rogers defended the administration. “The President is and always has been motivated solely by what is best for the American people,” she said.
Meanwhile, an SEC spokesperson declined to comment on the settlement. Sun, who holds citizenship in St. Kitts and Nevis, had avoided traveling to the U.S. during the lawsuit. The legal pressure kept him largely outside the country. Now, with the case resolved, that pressure is gone.
He said he looks forward to working with the SEC. His goal is to help develop clearer future guidance for the entire crypto industry. The settlement is still pending court approval. Nevertheless, legal experts expect the judge to finalize the agreement soon. Once approved, it will officially end a two-year legal battle that drew global attention.
Written by Fazal Ul Vahab C H
