Ian Balina found guilty by SEC for selling unregistered cryptocurrency
A Texas federal court ruled that cryptocurrency influencer Ian Balina violated securities laws. Sells unregistered securities to U.S. investors.
May 22nd Judge David Alan Ezra Ruling in favor of the U.S. Securities and Exchange Commission (SEC) In the case against Ballina, Spakster (SPRK) tokens are actually securities.
The SEC filed a lawsuit in 2022, accusing Ballina of: Illegally promoting and selling tokens.
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Judge Ezra’s decision was as follows. Based on Howey test, This defines an investment contract as a situation where investors pool their money into a joint enterprise with the expectation of profits generated by the efforts of others. The court concluded that SPRK met these criteria.
Court too It agreed with the SEC’s argument that Balina specifically targeted U.S. investors. Ballina’s claim is dismissed. Because the sale took place overseas, Samsung Electronics had no jurisdiction.
However, the court It did not support the SEC’s accusation that Balina failed to disclose a compensation agreement with Sparkster CEO Sajjad Daya. Cite inconsistencies in the evidence presented.
According to the SEC, between May and July 2018, Balina They purchased $5 million worth of SPRK tokens, promoted them through social media, and created a Telegram group to gather investment in the tokens.
SEC is ballinaga He did not tell investors about the 30% bonus he received. For his token purchase. Balina countered that the bonus was just that: a bonus. This is a bulk discount commonly found in private pre-sales.
Sparkster, which bills itself as a blockchain application development platform that requires minimal coding, We conducted an ICO for SPRK tokens from April to July 2018.
By September 2022, Sparkster will reached a settlement with the SEC; Agree to destroy remaining SPRK tokens and remove them from trading platforms Without acknowledging or denying the SEC’s claims. As part of the settlement, Sparkster was ordered to: He must pay $30 million in liquidation, $4.6 million in interest, and $500,000 in civil penalties.
This case highlights the SEC’s ongoing efforts to regulate cryptocurrency markets and enforce securities laws.
In related news, the SEC issued a notice to Wells, alleging that Uniswap was operating as an unregistered stock exchange. Uniswap recently released a statement refuting these claims.
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