U.S. SEC Ends Case Against Justin Sun and Tron Foundation, Rainberry Pays $10M Fine
- SEC drops claims against Justin Sun and Tron Foundation, ending the 2023 crypto case.
- Rainberry accepts $10M penalty and compliance terms to resolve the SEC crypto enforcement case.
- Settlement closes long-running SEC lawsuit tied to TRX and BTT token promotion claims.
The SEC has formally ended a long-running enforcement case against crypto entrepreneur Justin Sun and two entities linked to his blockchain ecosystem. Court documents show the regulator dismissed its claims against the Tron Foundation and the BitTorrent Foundation, closing a legal dispute that began in 2023.
The resolution came through a Final Judgment filed in the U.S. District Court for the Southern District of New York. While most defendants saw their claims dismissed, another company connected to Sun’s crypto network, Rainberry, agreed to pay a $10 million civil penalty and comply with regulatory conditions tied to securities practices.
Court Filing Concludes Long-Running Enforcement Case
According to the court filing, the SEC dismissed its allegations against Justin Sun, the Tron Foundation, and the BitTorrent Foundation “with prejudice.” This legal term means the regulator cannot bring the same case again against the same parties.
The case originally emerged during the aggressive regulatory campaign targeting digital asset companies in 2023. At the time, the agency accused Sun and his companies of conducting unregistered securities offerings tied to the TRX and BTT tokens.
The regulator also alleged that Sun orchestrated wash trading designed to inflate trading activity in TRX markets. Authorities further claimed celebrities were paid to promote TRX and BTT without revealing they had received compensation.
Despite the dismissal of claims against the main defendants, the court ordered Rainberry, the company behind the BitTorrent protocol and BTT token development, to pay a $10 million civil penalty. The company also agreed to comply with conditions prohibiting deceptive market practices.
Rainberry Settlement and Compliance Conditions
Rainberry’s agreement forms the financial component of the broader settlement. The company accepted the payment obligation while neither admitting nor denying the allegations outlined in the case.
Court documents state Rainberry must also commit to avoiding deceptive conduct involving securities markets. These compliance terms are standard in many regulatory settlements involving financial misconduct claims.
The judgment remains subject to final court approval. If approved, it will officially close one of the notable digital asset enforcement cases launched during the earlier phase of U.S. crypto regulation.
Celebrity Promotion Allegations From 2023
The original lawsuit included claims related to celebrity endorsements of digital tokens connected to Sun’s network. In 2023, the SEC accused eight public figures of promoting TRX and BTT without disclosing that they were paid to do so.
Celebrities named in the case included Lindsay Lohan and Jake Paul. Six of the individuals later agreed to settle the charges without admitting wrongdoing. They collectively paid about $400,000 in disgorgement, interest, and penalties.
However, two musicians, Cortez “Soulja Boy” Way and Austin Mahone, did not participate in those settlements at the time.
Related: Wall Street Regulators Step Up Oversight of Crypto and Prediction Markets
Changing Enforcement Environment in U.S. Crypto Policy
The dismissal of claims against Justin Sun arrives as the SEC reevaluates several enforcement actions tied to digital assets. Since early 2025, the regulator has dropped multiple lawsuits involving major crypto platforms.
These include cases against companies such as Binance, Coinbase, and Uniswap. In February 2025, the agency also requested a pause in the Sun litigation while exploring potential settlement discussions.
The case has also drawn political attention. Three Democratic lawmakers, Maxine Waters, Brad Sherman, and Sean Casten, recently criticized the agency’s decision to scale back certain crypto enforcement efforts.
They pointed to financial ties between digital asset firms and political campaigns. According to their statement, crypto companies contributed at least $85 million to President Donald Trump’s reelection campaign.
Sun has also made major investments in crypto initiatives linked to the Trump family. Public disclosures show he purchased at least $75 million worth of the World Liberty Financial (WLFI) token and $100 million of the TRUMP memecoin, launched shortly before inauguration events.
In a statement on the social media platform X, Sun confirmed the case resolution and said he remained focused on building blockchain technology despite the legal dispute. With the dismissal of claims against Justin Sun and the Tron Foundation, the settlement marks the formal conclusion of a prominent crypto enforcement case that began during the earlier regulatory crackdown on digital asset markets.
