The U.S. Securities and Exchange Commission has reached a settlement with crypto entrepreneur Justin Sun, closing a lawsuit that began in 2023 over alleged securities violations tied to the TRON (TRX) ecosystem.
According to a court filing in Manhattan federal court, Rainberry Inc., a company linked to the Tron network, agreed to pay a $10 million civil penalty. The proposed settlement states that Rainberry must comply with securities regulations and avoid future violations. The agreement also dismisses remaining claims against Sun and his companies, including the TRON Foundation and BitTorrent Foundation.
“The remaining claims against Rainberry would be dismissed with prejudice,” the filing said. “The Final Judgment would also dismiss all claims against Justin Sun, Tron Foundation, and BitTorrent Foundation.”
A dismissal with prejudice prevents the regulator from bringing the same claims again over the same conduct. The proposed settlement still requires approval from a federal judge.
Sun addressed the outcome shortly after the filing.
“Today’s resolution brings closure, but I never stopped building,” Sun wrote on X. “I will continue to focus on accelerating innovation in the United States and around the world and look forward to working with the SEC to develop guidance and regulations for crypto going forward.”
I am very pleased to confirm that the SEC has moved to dismiss all claims against me, Tron Foundation, and BitTorrent Foundation.
— H.E. Justin Sun 👨🚀 🌞 (@justinsuntron) March 5, 2026
Today’s resolution brings closure, but I never stopped building. I will continue to focus on accelerating innovation in the United States and around…
Allegations centered on token sales and wash trading
The SEC filed the lawsuit in March 2023 during the tenure of former chair Gary Gensler. Regulators accused Sun and several affiliated entities of violating federal securities laws through the sale and promotion of crypto tokens.
The agency alleged that the defendants distributed unregistered securities through the sale and airdrops of TRX and the BitTorrent (BTT) token. The complaint also described what the regulator called an “extensive wash trading” scheme that artificially influenced trading activity in TRX markets.
Federal regulators also claimed that Sun coordinated celebrity promotions without disclosure of compensation. The SEC named several public figures, including Lindsay Lohan and Jake Paul, in earlier enforcement actions tied to token promotions. Several celebrities later agreed to financial settlements without admitting wrongdoing.
Sun rejected the allegations during the litigation. His legal team argued that the case relied on applying United States securities law to activity that occurred largely outside the country.
SEC enforcement strategy shifts after Trump return
The settlement arrives during a broader shift in crypto enforcement under the administration of Donald Trump, who returned to the presidency in 2025.
Since the start of the administration, the SEC has dropped, paused, or settled multiple crypto cases that began under earlier leadership. Enforcement actions against companies such as Coinbase and Kraken have also ended through dismissal or settlement agreements.
Leadership at the regulator has changed during the same period. Paul Atkins now serves as chairman of the SEC after a period when commissioner Mark Uyeda acted as interim chair.
Political criticism grows over Trump-linked crypto ties
The settlement triggered criticism from some lawmakers who question Sun’s connections to Trump family crypto ventures.
Elizabeth Warren, a long-time critic of the crypto industry, criticized the outcome shortly after the SEC filing.
“Justin Sun poured $90 million into Trump’s crypto ventures, and today the SEC agreed to drop its case against him,” Warren said.
“The SEC should not be a lap dog for Trump’s billionaire buddies, and any crypto legislation moving through Congress must stop the president’s crypto corruption.”
Sun holds a large stake in World Liberty Financial, a crypto project linked to Trump’s sons. Trump appears on the company’s website as co-founder emeritus.
The entrepreneur purchased at least $75 million worth of the project’s WLFI tokens. He also bought millions of dollars worth of the TRUMP memecoin, which launched in early 2025.
Sun has appeared at conferences and private gatherings with members of the Trump family during the past year.
Congressional scrutiny intensifies
The political response extends beyond Warren. Maxine Waters, the ranking member of the House Financial Services Committee, has called for closer oversight of the SEC’s approach to crypto enforcement.
Earlier this year, Waters urged regulators to examine the agency’s retreat from several enforcement actions involving digital asset firms.
Three Democratic lawmakers also warned that unresolved legal disputes involving Sun could weaken trust in the financial regulator. Their statement raised concerns about a possible “pay-to-play scheme” tied to investments in Trump-affiliated crypto ventures.
The White House has rejected claims that the president’s private interests influence regulatory decisions.
“The president has no involvement in business deals that would implicate his constitutional responsibilities,” White House counsel David Warrington told earlier this year.
A high-profile figure in crypto
Sun remains one of the most recognizable figures in the digital asset sector. His career has often mixed blockchain development with headline-grabbing publicity.
The entrepreneur purchased the artwork Comedian, which features a banana taped to a wall, for more than $6 million. He later ate the banana during a press conference.
Sun acquired the BitTorrent platform in 2018 and later introduced the BTT token as part of the network’s blockchain integration.
The latest settlement closes a legal dispute that lasted nearly three years. The political debate around crypto regulation and presidential ties to the industry shows no sign of slowing as U.S. lawmakers prepare for the upcoming midterm election cycle.
Roman Zaika
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