Earlier today we wrote about Justin Sun and his crypto project Tron (TRX) being sued by the Securities and Exchange Commission (SEC). TRX tokens would be an unregistered securities if it were up to the SEC. However, it does not stop there. The SEC is also indicting eight US celebrities for illegally promoting TRX and BTT tokens.
Today we charged crypto entrepreneur Justin Sun and three of his wholly-owned companies for the unregistered offer and sale of crypto asset securities Tronix and BitTorrent.
Read more:https://t.co/4tXgKNof6Q
— U.S. Securities and Exchange Commission (@SECGov) March 22, 2023
Embarrassed American celebrities
Tron and BitTorrent are both Sun companies. The CEO paid several ‘celebrities’ to promote his tokens through social media. In addition to the aforementioned Paul and Lohan, rappers Soulja Boy and Lil Yaghty, singers Austin Mahone, Ne-yo and Akon and porn star Kendra Lust are also guilty, according to the SEC.
According to the SEC, the group of celebrities promoted TRX and BTT tokens “without stating that they were compensated for this and how much compensation they received.” Sun, along with the celebrities, “misled American investors with unregistered securities, and generated millions in illegal activities.”
All of the above celebrities, with the exception of Soulja Boy and Mahone, have collectively paid $400,000 in fines to the SEC. YouTube star Jake Paul accounted for the lion’s share of this. He pays the SEC $100,000.
Sun doesn’t care
Through Twitter Sun responds to all the commotion. According to him, the SEC’s indictment against him has little substance.
“The SEC’s indictment is yet another action it is taking against major players in the blockchain and crypto sector. We believe that the charge has little substance, and meanwhile we will continue to build the most decentralized financial system.”
Last October, Kim Kardashian was also charged by the SEC for similar practices. She would have cheated her social media followers. In 2021, she was involved in a large-scale promotion of the EthereumMAX token.
This token had nothing to do with Ethereum (ETH), and turned out to be a pump and dump to be. Kardashian paid $1.26 million to the SEC.
The SEC is very firm in its view on such social media promotions. Vulnerable celebrity followers are exposed to highly risky investment opportunities. Protecting investors is the SEC’s primary priority.
