The Securities and Exchange Commission (SEC) wants to hear from Tron founder Justin Sun, rapper Soulja Boy and YouTube pop star Austin Mahone on the Tronix crypto token. The stock market policeman has issued a summons to those concerned. It follows a civil lawsuit filed by the agency last month regarding tokens issued by Tron and file sharing company BitTorrent.
BitTorrent Token case: celebrities in the dock
Initially, this case involved many celebrities. Actress Lindsay Lohan, rapper Lil Yachty, singers Akon and Ne-Yo have settled with the SEC. They agreed to return their winnings. In return, they were allowed to deny the SEC charges. The trio that have been named as the only holdouts by the SEC according to TheBlock. In the complaintthey are accused of declaring Tronix and BTT, the BitTorrent token, as unregistered securities offerings.
The SEC threatens Sun, Mahone and Deandre Cortez aka that a default judgment will be entered against them if they do not appear within 21 days.
What consequences after these convocations of the SEC?
First, a ban on offering securities with digital assets weighs on Tron. Thus, Justin Sun could also pay civil penalties. In addition, the complaint also sought to permanently bar Sun from serving as an officer or director of any company issuing securities. In addition, similar sanctions weigh on Mahone and Way who could face bans.
According to the SEC, Justin Sun ordered his employees to initiate more than 600,000 Tronix wash swaps between multiple crypto exchanges. This type of operation creates the illusion of a strong demand for the token in order to increase its price.. Thus, the SEC says it found that between 4.5 million and 7.4 million tokens were traded daily in this way. This is a major violation of anti-fraud provisions.
In short, Justin Sun was content to respond to the complaint in a Tweet saying that it lacks arguments. A risky game since the SEC has very often was right about crypto businesses. Could Tronix risk a total broadcast ban?
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