The US Securities and Exchange Commission (SEC) has officially ended its lawsuit against crypto entrepreneur Justin Sun after one of his companies agreed to pay a $10 million settlement, bringing a three-year legal dispute to a close.

According to a letter sent by the SEC to a federal court in Manhattan, Rainberry, a company associated with Sun, will pay the $10 million fine. In return, the regulator will drop its claims against Sun and his related entities, including the Tron Foundation and the BitTorrent Foundation.

The SEC clarified that the settlement does not require Sun or his companies to admit or deny the allegations made in the case.

Background of the Lawsuit

The lawsuit was originally filed in March 2023, when the SEC accused Justin Sun and his companies of violating US securities laws. The regulator claimed they sold unregistered securities through the Tronix (TRX) and BitTorrent (BTT) tokens.

Additionally, the SEC alleged that Sun engaged in manipulative wash trading of TRX, artificially inflating trading volumes. The complaint also stated that Sun paid several celebrities — including Akon, Lindsay Lohan, and Jake Paul — to promote TRX and BTT without properly disclosing that they were being compensated for the promotions.

Sun denied the accusations and argued that the SEC was attempting to apply US regulations to activities that were largely conducted outside the United States.

Wider Crypto Enforcement Shift

This case is one of several crypto-related lawsuits that the SEC has recently dropped or settled. Under the Trump administration, the regulator has also backed away from enforcement actions against major crypto platforms such as Kraken and Coinbase, which were initially pursued during the tenure of former SEC Chair Gary Gensler.

Political Concerns Around Sun

Justin Sun’s connections to Donald Trump’s family crypto project, World Liberty Financial, have also attracted attention from lawmakers.

In November 2024, shortly after Trump won the presidential election, Sun became the largest investor in the project by purchasing $30 million worth of its tokens. He later increased his investment to $75 million in January 2025.

Shortly afterward, both the SEC and Sun requested the court to pause the lawsuit in order to explore a possible settlement.

Last month, several Democratic lawmakers — including Maxine Waters, Brad Sherman, and Sean Casten — raised concerns that dropping the case could weaken confidence in financial regulators. They also warned of a potential “pay-to-play” scenario, citing Sun’s large investment in World Liberty tokens.

Sun Responds

Following the settlement announcement, Sun said in a post on X (formerly Twitter) that the resolution brings closure to the case. He added that he looks forward to working with the SEC to help develop clearer crypto regulations in the future.

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Disclaimer

This content is for informational purposes only and not financial advice. Crypto markets are risky, so always do your own research and invest only what you can afford to lose.