$10 million! Justin Sun reaches settlement with SEC
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The two-year-long enforcement case between the U.S. Securities and Exchange Commission (SEC) and Justin Sun has seen substantial developments.
On March 6, according to media reports, based on a proposed final judgment submitted to a New York federal court on Wednesday (March 4), the SEC will drop all remaining charges against Justin Sun and related entities, on the condition that Rainberry (a company related to the TRON blockchain) pays a $10 million civil penalty. This settlement marks the impending conclusion of one of the most high-profile SEC enforcement actions in the crypto industry.
On March 5, Justin Sun stated, he has confirmed that the SEC will dismiss all charges against him, the TRON Foundation, and the BitTorrent Foundation. He also said he looks forward to cooperating with the SEC in jointly developing guidelines and regulatory frameworks for the future of cryptocurrencies.
Analysts point out that the direct impact on the market is that the longstanding regulatory uncertainty hanging over the TRON ecosystem will be removed. Rainberry has agreed to the settlement without admitting or denying the related allegations, a standard clause in SEC enforcement actions. However, the proposed judgment still requires final approval from the federal judge in the Southern District of New York.
SEC Dismisses Remaining Claims "With Prejudice"
It is reported that, according to the proposed agreement, the SEC will dismiss the remaining charges against Justin Sun, the TRON Foundation, and the BitTorrent Foundation.
The proposed agreement states that the remaining claims against Rainberry will be dismissed "with prejudice," and the final judgment will also dismiss all claims against Justin Sun, the TRON Foundation, and the BitTorrent Foundation.
It is understood that "with prejudice" means the SEC will not be able to bring a similar case against the same conduct in the future.
The SEC has reviewed and approved the settlement terms, which are reflected in the consent order and the proposed final judgment. Rainberry, Justin Sun, TRON Foundation, and BitTorrent Foundation have agreed to the final judgment taking effect.
This settlement comes amid a significant shift in U.S. crypto regulatory policy. During former SEC Chair Gary Gensler's tenure, the application of securities laws to the digital asset industry was aggressively expanded. Since his departure, the regulatory agency's overall stance toward crypto enforcement has been readjusting.
Recently, Justin Sun has also attracted attention for his connection with World Liberty Financial—a crypto project linked to allies of President Trump.
The proposed settlement does not involve these activities, but the resolution of this case will remove the most prominent regulatory cloud hanging over the TRON founder and his companies.
In 2023, the SEC sued Justin Sun, alleging he sold unregistered securities through companies under his control—TRON Foundation, BitTorrent Foundation Ltd., and Rainberry Inc.—and manipulated the TRX token market with "wash trading," deceiving investors.
It should be noted that the settlement plan is not without controversy. Amanda Fischer, Policy Director and COO of the financial reform group Better Markets, expressed strong criticism of the outcome. Fischer, former chief of staff to SEC Chair Gensler, stated:
"Although the SEC had substantial evidence against Justin Sun and his crypto operations, the Commission nevertheless reached a favorable settlement today. Given the scale and brazen nature of Sun’s alleged fraud, this is nothing more than a face-saving gesture."
Fischer urged the presiding judge to reject approval of the settlement and suggested that Congress conduct oversight of the SEC's decision.
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