TLDR
- A three-year enforcement action by the SEC against Justin Sun, founder of Tron, has concluded with a $10 million settlement agreement
- Rainberry Inc., Sun’s company, will cover the financial penalty; allegations against Sun individually, Tron Foundation, and BitTorrent Foundation are being dropped
- Neither Sun nor his affiliated entities admitted guilt or denied wrongdoing as part of the agreement
- Prior to reaching the settlement, Sun had committed $75 million to World Liberty Financial, a cryptocurrency venture associated with Trump
- A federal judge must still approve the proposed settlement terms
The enforcement action originated in March 2023 when the SEC brought charges against Sun and his business entities, claiming they distributed unregistered securities via the Tronix and BitTorrent tokens. The regulator additionally claimed Sun engaged in “manipulative wash trading” with TRX and orchestrated undisclosed celebrity endorsement campaigns.
JUST IN: 🇺🇸 SEC ends case against Tron Founder & crypto billionaire Justin Sun. pic.twitter.com/hb8j85T0eO
— Watcher.Guru (@WatcherGuru) March 5, 2026
The celebrity endorsers identified in the enforcement action included musician Akon, Hollywood actress Lindsay Lohan, and social media personality Jake Paul. According to the SEC, these influencers received compensation for promoting TRX and BTT tokens without disclosing the financial arrangement to their followers.
Throughout the proceedings, Sun maintained his innocence. His defense centered on the argument that the SEC was improperly extending US securities law to activities he characterized as “predominantly foreign conduct.”
According to the settlement agreement, Rainberry Inc. — a Sun-controlled entity connected to the Tron blockchain — will remit a $10 million civil penalty. The company is additionally prohibited from committing future securities law violations.
Charges against Sun in his personal capacity, as well as against the Tron Foundation and BitTorrent Foundation, will be dismissed with prejudice. This legal designation prevents the SEC from refiling identical claims based on the same underlying actions.
Neither party admitted to or denied the allegations under the settlement framework.
Settlement Talks Began After Trump’s Return to Office
Legal proceedings were suspended in early 2025 to facilitate settlement discussions. This timing coincided with Donald Trump’s inauguration in January 2025.
By November 2024, Sun had positioned himself as the primary investor in World Liberty Financial — a cryptocurrency initiative connected to the Trump family. His initial purchase totaled $30 million in tokens, which he subsequently increased to $75 million. When accounting for unvested tokens, his position grew to approximately $700 million by mid-2025.
Last month, three Democratic members of the House of Representatives — Maxine Waters, Brad Sherman, and Sean Casten — expressed alarm about the case’s resolution. They cautioned that abandoning the Sun prosecution might “undermine investors’ confidence” in the regulatory agency and suggested the existence of a possible “pay-to-play scheme.”
A Pattern of Dropped Crypto Cases Under New Leadership
Under previous chair Gary Gensler’s tenure, the SEC initiated numerous cryptocurrency enforcement actions. Following Trump’s assumption of office, the agency shifted course by dismissing or settling a significant number of these cases.
Notable dismissals included enforcement actions targeting Kraken and Coinbase. Paul Atkins now serves as the SEC’s Chairman.
The Sun matter remained active longer than comparable cases because it encompassed allegations of fraud and market manipulation, extending beyond simple registration infractions.
I am very pleased to confirm that the SEC has moved to dismiss all claims against me, Tron Foundation, and BitTorrent Foundation.
Today’s resolution brings closure, but I never stopped building. I will continue to focus on accelerating innovation in the United States and around…
— H.E. Justin Sun 👨🚀 🌞 (@justinsuntron) March 5, 2026
Following the filing, Sun shared on X: “Today’s resolution brings closure, but I never stopped building.”
Final approval from a federal judge is required before the settlement becomes legally binding.
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