SEC v. JUSTIN SUN; TRON FOUNDATION LIMITED; BITTORRENT FOUNDATION LTD.; RAINBERRY, INC.; AUSTIN MAHONE; and DEANDRE CORTEZ WAY, No. 1:23-cv-02433, Southern District of New York (Mar. 5, 2026) — Complaint

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

SECURITIES AND EXCHANGE COMMISSION,

Plaintiff,

v.

JUSTIN SUN, TRON FOUNDATION LIMITED,
BITTORRENT FOUNDATION LTD.,
RAINBERRY, INC., AUSTIN MAHONE, and
DEANDRE CORTEZ WAY,

Defendants.

No. 1:23-cv-02433-ER

JURY TRIAL DEMANDED

AMENDED COMPLAINT

Plaintiff Securities and Exchange Commission (the “SEC” or “Commission”) submits

this Amended Complaint as a matter of course, pursuant to Federal Rule of Civil Procedure

15(a)(1)(B),1 and alleges the following:

SUMMARY

1. This action arises from Defendant Justin Sun’s (“Sun”) orchestration of the

unregistered offer and sale, manipulative trading, and unlawful touting of crypto asset securities.

2. Working through several companies that he owns and controls—including

Defendants Tron Foundation Limited (“Tron Foundation”), BitTorrent Foundation Ltd.

(“BitTorrent Foundation”), and Rainberry, Inc. (“Rainberry,” and collectively with Sun, the Tron

Foundation, and the BitTorrent Foundation, the “Sun Defendants”)—Sun engineered the offer

and sale of two crypto asset securities called “TRX” and “BTT.”  Starting around August 2017,

1  A motion to dismiss the original Complaint under Federal Rule of Civil Procedure 12(b) was filed on
March 28, 2024.  See ECF Nos. 54-56.  Therefore, this Amended Complaint as a matter of course is timely under
Federal Rule of Civil Procedure 15(a)(1)(B).  The arguments in the motion to dismiss lacked merit, but the SEC has
alleged additional facts in this Amended Complaint to dispose of those arguments.

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and continuing thereafter, the Sun Defendants engaged in a scheme to distribute billions of TRX

and BTT to the public while also creating active secondary markets on which TRX and BTT

could be traded.

3. The Sun Defendants offered and sold TRX and BTT as securities and were thus

required to register those offers and sales with the SEC unless an exemption from registration was

available.  But they never did so.  Despite engaging in widespread public offers and sales of TRX

and BTT, and even though no exemption from registration was available, neither Sun nor his

entities ever filed a registration statement with the SEC.

4. Sun also directed the manipulative wash trading of TRX to create the artificial

appearance of legitimate investor interest and keep TRX’s price afloat.  Sun accomplished this wash

trading through the Tron Foundation, whose employees conducted the trades at Sun’s direction; the

BitTorrent Foundation, which, together with the Tron Foundation, owned and controlled nominee

accounts used in the trading; and Rainberry, whose employees transferred funds to facilitate the

trading and opened at least one nominee account used in the trading.  Sun’s wash-trading team,

working under his direction, engaged in hundreds of thousands of TRX wash trades between

accounts that Sun ultimately controlled.  None of those trades involved any change in beneficial

ownership or had any legitimate economic purpose.

5. To drive public interest in TRX and BTT, the Sun Defendants created a publicity

campaign that involved paying celebrities located in the United States, including Defendants

Austin Mahone (“Mahone”) and DeAndre Cortez Way (“Way”), among others, to promote or tout

TRX and BTT on their social media accounts, which had millions of followers.  Although the

celebrities were paid to promote TRX and BTT, their touts on social media did not disclose that

they had been paid or the amounts of their payments.  Thus, the public was misled into believing

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that these celebrities had unbiased interest in TRX and BTT and were not merely paid

spokespersons.

6. Additionally, Sun materially misrepresented the truth about the touting campaign

to deceive investors.  In February 2021, Sun stated falsely on social media, “If any celebrities are

paid to promote TRON, we require them to disclose.”  In fact, Sun himself arranged the

payments to celebrities and knew those payments were not disclosed.

7. By their conduct alleged herein, the Sun Defendants violated registration and anti-

fraud provisions of the Securities Act of 1933 (the “Securities Act”), specifically Sections 5(a) and

(c), 15 U.S.C. §§ 77e(a) and (c), and Sections 17(a)(1) and (3) of the Securities Act, 15 U.S.C. §§

77q(a)(1) and (3).  They also violated anti-manipulation and anti-fraud provisions of the Securities

and Exchange Act of 1934 (the “Exchange Act”), specifically Sections 9(a)(1) and (2), 15 U.S.C.

§§ 78i(a)(1) and (2), and Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5

thereunder, 17 C.F.R. § 240.10b-5.  Additionally, they aided and abetted violations of the anti-

touting provision, Section 17(b) of the Securities Act, 15 U.S.C. § 77q(b), by multiple

celebrities, including Mahone and Way.

8. By their conduct alleged herein, Mahone and Way violated the anti-touting

provision, Section 17(b) of the Securities Act, 15 U.S.C. § 77q(b).

9. Unless restrained and enjoined, Defendants will continue to violate the federal

securities laws.

JURISDICTION AND VENUE

10. The Court has subject matter jurisdiction over this action pursuant to Sections

20(b), 20(d) and 22(a) of the Securities Act, 15 U.S.C. §§ 77t(b), 77t(d) and 77v(a), and Sections

21(d) and 27(a) of the Exchange Act, 15 U.S.C. §§ 78u(d) and 78aa(a).

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11. The Court has personal jurisdiction over Defendants because, through their

conduct alleged herein, they purposefully took actions in and directed toward the United States.

For example, among other things, all Defendants promoted TRX and/or BTT to consumers and

investors located in the United States.  The Sun Defendants also offered and sold TRX and BTT

in unregistered transactions to individuals located in the United States, and they conducted a

fraudulent scheme to wash trade TRX on a trading platform based in the United States called

Bittrex, Inc. (“Bittrex”).  Additionally, in the course of his work on behalf of the Tron

Foundation, the BitTorrent Foundation, and/or Rainberry, Sun travelled extensively to the United

States during the time that TRX and BTT were promoted, offered, and sold.  Specifically, Sun

spent more than 80 days in the United States in 2017, more than 120 days in the United States in

2018, and approximately 180 days in the United States in 2019.  During Sun’s business trips to

the United States in 2019, he spent time in various cities, including New York City, Boston,

Massachusetts, and San Francisco.  Rainberry also rented an apartment where Sun stayed during

some of his business trips to the United States in 2019.

12. Venue is proper in this District pursuant to Section 22(a) of the Securities Act, 15

U.S.C. § 77v(a), and Section 27(a) of the Exchange Act, 15 U.S.C. § 78aa(a), because, among

other things, some of Defendants’ acts and transactions that violated the federal securities laws

occurred in this District.  For example, the Sun Defendants offered and sold TRX and/or BTT in

unregistered securities transactions to multiple investors who resided in this District.

Additionally, the touting tweets by Mahone and Way described herein, and Sun’s various tweets

described herein, were sent to Twitter users across the United States, including in this District.

DEFENDANTS

13. Defendant Justin Sun (a/k/a Yuchen Sun), age 33, is a Chinese national and

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crypto asset entrepreneur.  Sun attended college in China and received a post-graduate degree

from the University of Pennsylvania.  Sun is currently believed to be living in Singapore and/or

Hong Kong.  At all relevant times, Sun owned, controlled, and dominated the actions and

dealings of the Tron Foundation, the BitTorrent Foundation, and Rainberry.  As such, those

entities were Sun’s alter egos.  Additionally, through his actions, Sun blurred the distinctions

among the Tron Foundation, the BitTorrent Foundation, and Rainberry.  For example, as

described below, during public appearances that Sun made in San Francisco, California, in

January 2019, Sun promoted the Tron ecosystem, TRX, and BTT, while simultaneously

displaying the Tron logo, the Tron name, and the BitTorrent name.  Based on Sun’s actions and

statements, a reasonable investor considering whether to purchase or sell TRX or BTT would see

Sun as the face of the Tron ecosystem, TRX, and BTT, and little, if any, meaningful distinction

among the Tron Foundation, the BitTorrent Foundation, and Rainberry.  With respect to all of his

conduct alleged herein, Sun acted intentionally or recklessly.

14. Defendant Tron Foundation Limited was founded by Sun in 2017 as a

Singapore Public Company Limited by Guarantee.  The Tron Foundation is one of several alter

ego entities organized by Sun through which he conducted the TRX and BTT offerings and

managed the development and marketing of the Tron ecosystem.  From 2017 to the present, Sun

has owned and controlled the Tron Foundation.

15. Defendant BitTorrent Foundation Ltd. (sometimes d/b/a BitTorrent) was

founded by Sun in October 2018 as a Singapore Public Company Limited by Guarantee.  The

BitTorrent Foundation is one of several alter ego entities organized by Sun through which he

conducted the BTT offerings and managed, together with Rainberry, Inc., the development and

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marketing of the BitTorrent protocol.  From 2018 to the present, Sun has owned and controlled

the BitTorrent Foundation.

16. Defendant Rainberry, Inc. (sometimes d/b/a BitTorrent) is a California

corporation owned and controlled by Sun.  The corporation was founded in 2004 and operated as

BitTorrent, Inc. until June 2018, when it was acquired by Sun and renamed Rainberry, Inc.

From 2018 to the present, Sun has wholly owned and controlled Rainberry, making Rainberry

another of Sun’s alter ego entities.

17. Defendant Austin Mahone, age 28, is a U.S. citizen and a singer and songwriter

residing in Miami, Florida.  At or around the time of his relevant actions alleged herein, Mahone

had approximately 9.1 million followers on Twitter.2

18. Defendant DeAndre Cortez Way (a/k/a Soulja Boy), age 33, is a U.S. citizen

and a singer and record producer residing in Calabasas, California.  At or around the time of his

relevant actions alleged herein, Way had approximately 5.2 million followers on Twitter.

BACKGROUND ON SECURITIES OFFERINGS

19. Congress enacted the Securities Act to regulate the offer and sale of securities.  In

contrast to commercial principles of caveat emptor (or buyer beware), Congress in the Securities

Act enacted a regime of full and fair disclosure, requiring those who offer and sell securities to

the investing public to provide sufficient, accurate information to allow investors to make

informed decisions before they invest.

20. Sections 5(a) and 5(c) of the Securities Act generally require an issuer of

2  After the original Complaint was filed, Mahone and the SEC reached a settlement to resolve the SEC’s
claims against him and, pursuant to that settlement, the Court entered a Final Judgment against Mahone.  See ECF
Nos. 32 and 33.  This Amended Complaint repeats the SEC’s allegations against Mahone because those allegations
are part of the fact pattern alleged herein against the other Defendants.  But for the avoidance of doubt, the SEC does
not seek any further relief against Mahone through this Amended Complaint.

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securities to register an offering of securities through an effective registration statement before

the securities are offered and sold to the public.  See 15 U.S.C. § 77e(a) and (c).  Registration

statements for a securities offering provide public investors with material information about the

issuer and the securities to be offered and sold.

21. Section 2(a)(1) of the Securities Act defines “security” to include a wide range of

investment vehicles, including an “investment contract.”  15 U.S.C. § 77b(a)(1).  An investment

contract, for purposes of the Securities Act, includes any “contract, transaction or scheme

whereby a person invests his money in a common enterprise and is led to expect profits” from

the efforts of others.  SEC v. W.J. Howey Co., 328 U.S. 293, 298-99 (1946).  This broad

definition is “flexible” and “capable of adaptation to meet the countless and variable schemes

devised by those who seek the use of the money of others on the promise of profits.”  Id. at 299.

Courts have found that many types of investments, including crypto assets, may constitute

investment contracts and thus securities.  See, e.g., SEC v. Kik Interactive Inc., 492 F. Supp. 3d

169, 173 (S.D.N.Y. 2020) (holding that certain crypto assets were sold as securities in

unregistered transactions).

22. In analyzing whether something is a security, “form should be disregarded for

substance,” Tcherepnin v. Knight, 389 U.S. 332, 336 (1967), “and the emphasis should be on

economic realities underlying a transaction, and not on the name appended thereto,” United

Housing Found., Inc. v. Forman, 421 U.S. 837, 849 (1975).

BACKGROUND ON CRYPTO ASSETS

23. The term “crypto asset” generally refers to an asset issued and/or transferred using

distributed ledger or blockchain technology, including assets sometimes referred to as

“cryptocurrencies,” “digital assets,” “virtual currencies,” “digital coins,” and “digital tokens.”

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24. A blockchain or distributed ledger is a peer-to-peer database spread across a

network of computers that records all transactions in theoretically unchangeable, digitally

recorded data packages.  The system relies on cryptographic techniques for secure recording of

transactions.

25. Blockchains typically employ a consensus mechanism to “validate” transactions,

which, among other things, aims to achieve agreement on a data value or on the state of the

ledger.  Crypto assets may be traded on crypto asset trading platforms in exchange for other

crypto assets; they may also be also be purchased or sold from the platform in exchange for fiat

currency (legal tender issued by a country).

26. A blockchain “protocol” is a code, software, or algorithm that governs how a

blockchain, or a feature of a blockchain, operates, including, among other things, the validation

mechanism used for the particular blockchain.

27. On July 25, 2017, the SEC issued the Report of Investigation Pursuant to Section

21(a) of the Securities Exchange Act of 1934: The DAO, advising “those who would use . . .

distributed ledger or blockchain-enabled means for capital raising[] to take appropriate steps to

ensure compliance with the U.S. federal securities laws,” and finding that the offering of crypto

assets at issue in that report involved investment contracts and thus securities.

FACTS

I. Sun and the Tron Foundation Launched TRX and Promoted It as an Investment

A. Sun and the Tron Foundation Established the Tron “Ecosystem”

28. No later than June 2017, Sun and the Tron Foundation began promoting the Tron

“ecosystem”—i.e., a group of blockchain protocols, software code, and crypto assets controlled

by Sun and the Tron Foundation—through a series of “whitepapers” that they posted on the

internet.  The whitepapers often referred simply to “Tron” as a shorthand for the ecosystem that

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Sun and the Tron Foundation controlled.  The whitepapers were aimed at the investing public,

including investors in the United States.  At all relevant times, Sun and the Tron Foundation

controlled and had ultimate authority over the statements made in the whitepapers.

29. On or about August 22, 2017, Sun and the Tron Foundation posted Tron

Whitepaper Version 1.7 (the “TRX Whitepaper”) on the internet.  The TRX Whitepaper

explained that “TRON is a blockchain-based decentralized protocol that aims to construct a

worldwide free content entertainment system with the blockchain and distributed storage

technology.”  The TRX Whitepaper further explained that Tron’s protocol allowed users to

publish, store, and own data, and to participate in “a decentralized content entertainment

ecosystem.”

30. Additionally, the TRX Whitepaper stated that the Tron Foundation was

established “to operate [the] TRON network.”

B. Sun and the Tron Foundation Marketed TRX as an Investment Before Its
ICO

31. Sun and the Tron Foundation used the TRX Whitepaper to, among other things,

entice investors to purchase “TRX” (also known as “TRONIX”), a crypto asset that Sun and the

Tron Foundation called the “Official Token of TRON.”  The TRX Whitepaper made clear that

“[t]hose who wish to enter” the Tron ecosystem “must buy” TRX.  An investor would buy TRX

with either fiat currency or another crypto asset.

32. The TRX Whitepaper promoted an upcoming initial coin offering (“ICO”) of

TRX, comprising 40 percent of the 100 billion total TRX supply.  The TRX Whitepaper

explained that 35 percent of the remaining TRX would be allocated to the “TRON Foundation

and the ecosystem,” 15 percent would be allocated to a “[p]rivate offering,” and 10 percent

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would be allocated to “Peiwo Huanle (Beijing) Technology Co., Ltd.” (“Peiwo”), another

Chinese company that Sun founded, owned, and controlled.

33. The TRX Whitepaper described a “Realization Path” for the Tron ecosystem,

which would take “8 to 10 years,” in which investors’ contributions would be used to further

build out and enhance the Tron ecosystem.  The TRX Whitepaper indicated that investors’

fortunes were tied together, stating, “[a]ll TRON participants will benefit from its prosperity.”

34. The TRX Whitepaper also promoted the profit potential for investors in TRX.

For example, it stated: purchasers of TRX could “share [in] dividend growth”; Tron’s ecosystem

was designed for TRX “holders who [are] optimistic about TRON on a long-term basis”; “those

who hold and lock [TRX] for [the] long[-term] will be rewarded”; “[l]ong-term investment” was

“critical;” “stakeholders enjoy . . . sustainable growth”; and “[l]ong-term holding of stakeholders

[would] be the benchmark in the ecosystem and better lead the development of the ecology.”

(Emphasis added.)

35. The TRX Whitepaper additionally promoted the executive team whose efforts

would lead to TRX’s success.  For example, the TRX Whitepaper listed Sun as the “Founder and

Chief Executive Officer” and highlighted Sun’s prior experience working for another crypto

asset company, stating that the “market value of [the company] has exceeded ten billion US

dollars.”  Similarly, the TRX Whitepaper spotlighted other team members, emphasized their

credentials, and stated that the “TRON founding team will spare no efforts to realize the

development goal proposed in the white paper and expand the growth” of the Tron ecosystem.

36. The TRX Whitepaper, and similar, later whitepapers promoting TRX that Sun and

the Tron Foundation issued, remain on the internet and available to investors to this day.

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37. From about August through September 2017, Sun and the Tron Foundation

conducted the TRX ICO, offering and selling TRX to numerous purchasers who paid crypto

assets—including bitcoin (“BTC”) and ether (“ETH”)—in exchange for TRX.  In the ICO, 40%

of the total available supply of TRX was offered, sold, and otherwise distributed, with the

remaining TRX allocated for distribution in the proportions listed in the TRX Whitepaper: 35%

to the Tron Foundation and Tron ecosystem; 15% for distribution in a “private offering”; and

10% to Peiwo.  Sun owned and/or controlled the Tron Foundation and Peiwo, and thus he

effectively retained control over at least the 45% of TRX allocated to these entities.

C. Sun and the Tron Foundation Sought to Create a Secondary Market for
TRX While Continuing to Promote TRX as an Investment

38. In early 2018, Bittrex was a crypto asset trading platform incorporated in

Delaware, with its principal place of business in Seattle, Washington.  Bittrex was required to

register with the SEC as an “exchange” under the Exchange Act, but it failed to do so.3

39. On or about January 8, 2018, Sun sent an email (from his Tron email address) to

Bittrex personnel, with the subject line “TRON Token Logistics,” and attached various

documents for the purpose of getting TRX listed on Bittrex for trading.  The documents attached

to Sun’s email included, among other things, a version of the TRX Whitepaper; a Business

Profile for the Tron Foundation, which listed Sun as a Director; the Bittrex Token Application

and Listing Agreement, which was between Bittrex and the Tron Foundation and was signed by

Sun as the Tron Foundation’s “Founder & CEO”; and Exhibit B to the Bittrex Listing

3  In April 2023, the SEC charged Bittrex with, among other things, operating as an unregistered national
securities exchange in violation of the Exchange Act.  Bittrex settled the SEC’s charges, and in August 2023, a final
judgment was entered against Bittrex.  See SEC Litigation Release No. 25817 (Aug. 29, 2023), available at
https://www.sec.gov/litigation/litreleases/lr-25817.

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Application, which stated that the “Applicant” was the Tron Foundation and that the “Ultimate

Beneficial Owner” of the Tron Foundation was Sun.

40. On or about March 1, 2018, Bittrex announced publicly on Twitter that TRX was

“available for trading.”  Thereafter, Sun and the Tron Foundation publicly promoted each time

TRX was “listed”—or made available for trading—on a new crypto asset trading platform,

including the listing on a second U.S.-based platform on or about March 25, 2019.  From on or

about March 1, 2018, through approximately July 2021, Sun and the Tron Foundation tweeted

more than 200 times promoting the availability of TRX for trading on crypto asset trading

platforms.

41. Sun and the Tron Foundation also made other public statements promoting TRX

as an investment.  For example, on or about March 17, 2018, Sun and the Tron Foundation

posted on the U.S.-based digital publishing platform Medium a link to an article titled “4

Reasons to Invest in Tron, Before the Main Net Launch.”  The article explained that ongoing

efforts by Sun and the Tron Foundation “will boost the value of TRX” and stated that investors

“should invest now, while [they] still can.”  The article further advised investors “considering

investing in TRX” that “now is one of the best times to do it,” and that “[b]uying TRX now,

while its [sic] cheap, could lead to serious returns after the Tron Main Net launches and investors

rush to fill their bags.”

42. Sun and the Tron Foundation specifically targeted investors in the United States.

For example, on or about September 18, 2018, the Tron Foundation tweeted, “[y]ou can now buy

$TRX directly with USD on @BittrexExchange.”  That tweet linked to a Global Coin Report

post stating, “[T]his is the first time that Tron has been paired with the USD in the United

States.”

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43. That same day, Sun tweeted, “#TRX already can be traded on @BittrexExchange,

$USD markets, $USD/ $TRX.  First #TRX fiat trading pair in US.  Go #TRON.  Go #TRONICS.

#TRON to the future.”

44. On or about December 15, 2019, Sun retweeted a post from another individual,

which stated that investors in the United States could trade TRX “pretty much everywhere,

especially with a VPN.”4  Sun’s retweet announced, “[w]e will make $TRX available for all

[United States flag emoji] users!  More options are on the way!”  Sun and the Tron Foundation

worked with crypto asset trading platforms to make TRX widely available for trading by

investors in the United States, who could, at one point, trade TRX on at least four U.S.-based

platforms.

45. Sun and the Tron Foundation also regularly publicized their efforts to increase

TRX’s value.  For instance, in an interview posted on November 30, 2017, to the Medium page

of a popular investor in crypto assets, Sun promoted TRX’s availability for trading on four

crypto asset trading platforms, and represented that his “team [was] working hard on getting on

bigger exchanges.”

46. In the same interview, Sun described a six-stage “roadmap” for future

development, committing his team to a nearly eight-year development schedule.  Sun stated:

“The roadmap is on the official website, there are six stages, Exodus, Odyssey, Great Voyage,

Apollo Star, Trek, Eternity.  For now, we plan to make Peiwo APP compatible with TRX and

complete the development of our own main chain.  After the own main chain is done, we will

optimize the network based [sic] different kinds of online entertainments applications.”

4  A VPN or virtual private network uses encryption over a public network, typically the internet, to create a
secure, apparently private network.  Using a VPN allows a user to hide the public IP address of their device and,
depending on the provider, may allow a user to select an “exit node” in a specific country or geographic region,
hiding their actual location.

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47. Sun and the Tron Foundation also widely publicized their efforts to manage the

supply of TRX to ensure price appreciation for the benefit of TRX investors.  For example, on or

about June 26, 2018, Sun tweeted that “#TRON completed Coin Burn of 1 billion #TRX,” with a

link to a Tron Foundation Medium post explaining that “‘Coin burn’ refers to removing tokens

from the total supply” and “helps to control inflation and reward[s] token holders” because

reducing the total supply of TRX would typically increase the value of TRX remaining in the

market.

48. Likewise, on or about December 19, 2017, the Tron Foundation posted an

“Announcement to Our Investors” (emphasis added) on its Medium page, stating that “[t]he

34.2518% TRX held by Tron Foundation” was “locked up until January 1st, 2020,” and assuring

investors that “Tron Foundation TRX will not be withdrawn or traded.”  The Tron Foundation

concluded this post by stating, “[w]e are working hard in order to provide security and

supervision of all our investors, supporters and believers.”

49. Then, on or about June 26, 2019, the Tron Foundation posted to Medium an

“Announcement on $20 Million TRX Buy-back Plan and 2020 TRX Holding Plan,” which

detailed a plan to “conduct by far the largest TRX buy-back . . . with the widest coverage in the

secondary market, which will last for a year and will be conducted in several batches with no less

than $20 million.”  The stated purpose of this plan was “to promote community activity and

market stability.”  The Medium post also assured investors that “[t]he [Tron] Foundation will

continue to increase our TRX holdings in the secondary market to manifest our confidence in the

development of the TRON ecosystem.”

50. On or about June 27, 2019, Sun tweeted about the $20 million TRX buyback and

included a link to an article on cointelegraph.com reiterating the details posted to Medium.

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II. Sun and the Tron Foundation Engaged in Unregistered TRX Offers and Sales

51. TRX was offered and sold as a security, specifically as an investment contract.

All TRX purchasers, including those who tendered value for TRX other than cash or crypto

assets, invested in a common enterprise alongside Sun and the Tron Foundation, who at all times

retained significant TRX holdings.  Because the value of TRX rose or fell together for all

holders, all TRX holders profited or suffered losses in amounts proportionate to their TRX

holdings.  As such, their fortunes—including the realization of future profits—were inextricably

tied to Sun’s fortunes and to each other’s.  And, given the widespread promotional statements by

Sun and the Tron Foundation emphasizing the Tron Foundation’s TRX holdings, TRX

purchasers reasonably expected their fortunes to be inextricably tied to those of Sun, the Tron

Foundation, and each other.

52. All TRX purchasers’ and holders’ prospective profits also depended largely on

efforts by Sun and the Tron Foundation to develop the Tron protocol, make TRX available for

trading on crypto asset trading platforms, and promote TRX to potential investors to increase its

secondary market price for all holders.  And, given Sun and the Tron Foundation’s promotional

statements, TRX purchasers and holders reasonably expected that the value of their investment

would largely rise or fall on these efforts to increase TRX’s value.

53. For offers and sales of TRX alleged herein that involved purchasers based in the

United States, irrevocable liability was incurred and title transferred within the United States

because the purchasers were located in the United States when they took the necessary actions to

acquire TRX, including transmitting their purchase orders and payments for TRX.

54. From at least March 2018 through February 2019, Sun and the Tron Foundation

offered and sold TRX in three types of unregistered securities transactions described below.

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55. No registration statement was ever filed with the SEC or in effect with respect to

any of these offers and sales of TRX, and no exemption from registration was available for these

offers and sales of TRX.  Thus, the offers and sales of TRX described below violated the

registration provisions of the federal securities laws.

A. Offers and Sales of TRX on a U.S.-Based Crypto Asset Trading Platform

56. From on or about March 12, 2018, through February 11, 2019, Sun and the Tron

Foundation offered and sold approximately 542.6 million TRX to investors, including investors

in the United States who placed their orders on the U.S.-based crypto asset trading platform,

Bittrex.  During this time, multiple investors located in this District—specifically, in New York

City—purchased TRX through Bittrex.  In total, the unregistered sales of TRX, from

approximately March 2018 through February 2019, generated net proceeds of more than $31.9

million for Sun and the Tron Foundation.

B. Offers and Sales of TRX in the Tron “Emoji Contest”

57. Between August 13, 2018, and August 28, 2018, Sun and the Tron Foundation

offered and sold 50,000 TRX through an online bounty program, pursuant to which Sun and the

Tron Foundation transferred TRX to certain participants in exchange for completing specific

tasks promoting TRX or the Tron Foundation.  They referred to this specific bounty program as

an “emoji contest,” which required participants to “TELL A STORY ABOUT TRON WITH

EMOJIS” by posting and sharing on Facebook and/or Twitter original compositions using

“TRON elements” and emojis.

58. According to an August 13, 2018, post by the Tron Foundation to its blog on

Medium, creators of so-called “outstanding works,” specifically “the top 6 works with the most

likes and shares on both Twitter and Facebook” would be rewarded with 31,000 TRX—16,000

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TRX to the first-place winner, and 3,000 TRX each to five runners-up.  Another 5,000 TRX

would be distributed to randomly selected participants who met the contest requirements but

were not selected as winners based on the number of “likes and shares” received.

59. Sun posted a link to the Medium announcement on his own Twitter feed, writing

“#TRON EMOJI CONTEST: No text, no sound, creatively tell your story with the #TRON

emoji, check out the details and earn $TRX #TRX.”

60. To enter the “emoji contest,” participants had to upload their submissions to

Twitter and/or Facebook with the hashtag #TRONFUN, and tag (or “@”) ten friends as well as

@tronfoundation.  Friends tagged in the winning submissions would also receive TRX, with

4,000 TRX to be shared equally by the ten friends of the first-place winner, and 100 TRX to be

distributed to each of the ten friends tagged by the five runners-up.

61. The announcement also stated that “[w]orks and pictures of the winners will be

posted on TRON official website and official Twitter account.”

62. By entering the “emoji contest,” participants provided Sun and the Tron

Foundation with valuable consideration—the online promotion of the Tron ecosystem and TRX,

promotional artwork to feature on the Tron website, and the Twitter and Facebook handles of

entrants and their tagged friends—in exchange for an opportunity to receive TRX.

63. In total, Sun and the Tron Foundation distributed 50,000 TRX to winners of the

“emoji contest.”

64. Neither Sun nor any of the Sun Defendants took any steps to exclude U.S. persons

from receiving TRX in this offering, and at least one of the winners who received TRX was a

resident of this District.

 18

C. Offers and Sales of TRX in the “niTRON Sharing Campaign”

65. Between December 12, 2018, and December 16, 2018, Sun and the Tron

Foundation offered and sold 28,588 TRX through an online bounty program that required

participants to retweet and comment on the Tron Foundation’s tweet announcing the contest and

to include the hashtag “#niTRON.”

66. According to the Tron Foundation’s tweeted announcement, three second prize

winners—to be selected from among all contest entrants—would be awarded 6,666 TRX each,

while five third prize winners would each receive 1,718 TRX.  Two first prize winners would

receive tickets to attend the 2019 “niTron Summit,” a Tron-sponsored gathering at the Yerba

Buena Art Center in San Francisco to discuss and promote the Tron ecosystem, TRX, and BTT.

67. By entering the niTRON sharing contest, participants provided Sun and the Tron

Foundation with valuable consideration—the promotion of the Tron Foundation and the niTRON

summit on Twitter—in exchange for an opportunity to receive TRX.

68. Neither Sun nor any of the Sun Defendants took any steps to exclude U.S. persons

from receiving TRX in this offering, and at least one of the winners who received TRX was a

U.S. person.

III. The Sun Defendants Launched BTT and Promoted It as an Investment

A. Sun Acquired Rainberry and Incorporated It into the Tron Ecosystem

69. In or about June 2018, Sun purchased BitTorrent, Inc., a company based in San

Francisco, California.  BitTorrent, Inc.’s technology allowed users to download and transfer

digital data and files.  Sun changed the company’s name to Rainberry, although its promotional

materials and Sun’s public statements often continued to refer to the company as BitTorrent.

Sun then used Rainberry and the BitTorrent Foundation, which he formed in October 2018, to

 19

offer and sell both TRX and the BitTorrent Token, a new crypto asset with the trading symbol

“BTT.”

70. In a “Letter to the Community” posted to the Tron Foundation’s Medium page on

July 24, 2018, Sun announced “that TRON has successfully acquired BitTorrent and all

BitTorrent products.  From this day on, BitTorrent … will become part of the TRON

ecosystem….  Through this acquisition, BitTorrent and TRON will combine forces, with the

TRON US team merging with the BitTorrent team….  Combining the robust capabilities of the

two teams will take the technology behind the TRON ecosystem to a whole new level.”

(Emphasis added).

71. Around this time, Sun, the Tron Foundation, and the BitTorrent Foundation

posted similar announcements to their respective Twitter accounts.

72. Consistent with Sun’s July 24, 2018, announcement, Rainberry’s operations

became intertwined with those of the Tron Foundation.  Rainberry employees and executives—

who had previously used email addresses with the “@BitTorrent” domain—were provided with

“@tron.network” email addresses, and many Rainberry employees were tasked with working on

projects related to the Tron Foundation.

73. Sun and the Tron Foundation also began referring to key Rainberry personnel as

“Tron” employees on social media.  Additionally, Rainberry personnel and Sun, on behalf of the

Tron Foundation, the BitTorrent Foundation, and Rainberry, began appearing at events like the

“niTron Summit,” discussed above and below, to publicize Tron and TRX alongside BitTorrent

and BTT.

74. From approximately November 11 to 14, 2018, Sun sent several emails to Bittrex

personnel to discuss BTT and ask about “the listing process” for Bittrex to list BTT.

 20

B. The Sun Defendants Promoted BTT as an Investment

75. At all relevant times following his acquisition of BitTorrent, Inc., Sun had

ultimate authority over the BitTorrent Foundation and Rainberry’s social media accounts—

including the @BitTorrent Twitter and Medium accounts—and he directed, controlled, and

approved posts made on these accounts.

76. On or about January 3, 2019, the BitTorrent Foundation and Rainberry

announced, by tweet from the BitTorrent Foundation’s @BitTorrent Twitter account, the “new

BitTorrent $BTT” crypto asset, which purportedly would be “exclusively available to non-U.S.

accounts on #BinanceLaunchpad, the token sale platform [operated] by leading cryptocurrency

exchange @binance!”

77. In early January 2019, Sun traveled to Rainberry’s office in San Francisco,

California.  While in the San Francisco office, Sun and Rainberry’s Head of Product and

Engineering, who worked in the San Francisco office, broadcasted a livestream on the Internet to

promote the Tron ecosystem, TRX, and BTT.  In the livestream, Sun and the Head of Product

and Engineering appeared on camera, together, wearing sweatshirts featuring the BitTorrent

name and logo and displaying water bottles with the Tron logo.  During the livestream, Sun

explained that BTT would benefit TRX holders because “the current Tron community” would be

allocated with BTT, meaning that TRX holders would be “entitled” to receive “the BTT

airdrop.”  Sun stated that, because of the relationship between TRX and BTT, “the TRX

community [was] tied with the BTT community.”  Additionally, Sun stated that BTT would use

the “Tron network,” so BTT would attract numerous BitTorrent users and grow the Tron

ecosystem.  Sun also asserted that people who were interested in BTT were “definitely welcome

to join the Binance Launchpad to start to invest in the BTT token,” provided they completed the

“KYC [know your customer] process.”  The Head of Product explained, as Sun nodded along,

that BTT was created in part “to address this giant potential market without having to give all

those people TRX, in order to protect the existing TRX holders without diluting [TRX’s value]

by giving out lots of TRX.”  Sun also stated that the upcoming airdrops of BTT would be “all in

the Tron Foundation.”

78. On January 17 and 18, 2019, Sun again was present in San Francisco for the

niTron Summit, a two-day event before a live audience to promote the Tron ecosystem, TRX,

and BTT.  At the Summit, Sun appeared on stage wearing a shirt with the Tron logo displayed on

the front and a sweatshirt with the name BitTorrent on the back.  Speaking to the audience, Sun

showed a video highlighting the “market cap history” of TRX and illustrating its rising market

capitalization “in Millions USD” among the “Top 100 Cryptos by Market Cap.”  Sun told the

audience that, “today, I think we are number 9” in market capitalization, and in 2019, TRX was

“aiming to become at least number 4.”  Sun stated that TRX was “climbing the ladder of the

most valuable crypto currency.”  Discussing his plans for 2019, Sun indicated that he expected

TRX’s transaction volume to grow and that more exchanges would list TRX for trading.

Additionally, Sun promoted the upcoming “public sale” of BTT and the “airdrops” of BTT to

“TRX holders.”  Sun added that BTT would use the Tron “infrastructure” and thus “promote the

integration and synergy between the [sic] Tron and BitTorrent” in the Tron ecosystem.

79. The Sun Defendants scheduled the first offer and sale of BTT for late January

2019.  Around that time, the Sun Defendants posted to BitTorrent’s website a new whitepaper

(the “BTT Whitepaper”) to promote BTT to investors.  Sun controlled and had ultimate authority

over the statements made in the BTT Whitepaper.

80. The BTT Whitepaper stated that “[i]n 2018, BitTorrent formed a strategic

partnership with TRON,” and that the “TRON Foundation and BitTorrent Foundation are

 22

introducing a new cryptographic token, called BTT.”  The BTT Whitepaper further explained

that BTT would be “made available as a divisible token, allowing for granular pricing.”

81. The BTT Whitepaper also promoted the initial offering of BTT.  It explained that

990 billion BTT would be offered and sold, and that the tokens would be distributed as follows:

6% for public sale; 2% for private sale; 9% for “[s]eed sale”; 10.1% for “Tron airdrop tokens”;

10% for “BitTorrent protocol airdrop tokens”; 19% for the “BitTorrent Team and the BitTorrent

Foundation”; 20% for the Tron Foundation; 19.9% for the “BitTorrent ecosystem”’ and 4% for

“[p]artnership tokens.”

82. On or about January 29, 2019, the Sun Defendants publicly offered or caused to

be offered BTT for the first time through a so-called initial exchange offering (“IEO”).

83. Like ICOs, IEOs are offerings of crypto assets to raise capital.  However, IEOs

are conducted by crypto asset trading platforms on behalf of crypto asset issuers—usually for a

fee—and immediately provide a secondary market for crypto asset purchasers.

84. Only holders of TRX or another specifically-identified crypto asset were eligible

to purchase BTT in the IEO, and all BTT tokens offered in the IEO were sold in less than fifteen

minutes.

85. Soon after the IEO, on or about January 28, 2019, Sun tweeted:  “For those [who]

didn’t get #BTT in the public sale, stay tuned for the #TRX airdrop!  Own[ing] $TRX will secure

your chance to get $BTT! #TRON #BitTorrent.”

86. As with TRX, the BTT Whitepaper, and similar, later whitepapers promoting

BTT, remained on the internet and available to investors from February 2019 through the

present.

 23

C. The Sun Defendants Sought to Create a Secondary Market for BTT Trading
While Continuing to Promote It as an Investment

87. After the BTT IEO, the Sun Defendants, acting through the BitTorrent

Foundation, applied for and secured listings for BTT on various crypto asset trading platforms,

including Bittrex.

88. Social media posts by each of the Sun Defendants created a reasonable

expectation of profit for BTT investors.  For instance, immediately following the BTT IEO, on

January 31, 2019, Sun tweeted that he had “[t]ak[en] the humble approach and ke[pt] the initial

sale price low” to “benefit the community and reward them with decent return!”  The Sun

Defendants also promoted opportunities to profit from “staking” BTT on various platforms,

including more than 40 tweets from January 2020 through May 2021, further promoting BTT as

an investment.5

89. Later, around March 1, 2019, in a chat broadcast on Telegram,6 Sun stated that he

chose to offer and sell the new BTT tokens, rather than more TRX, to avoid “diluting the value

of TRX.”  Sun also emphasized that his goal was to “increase[e] the value of TRX and BTT.”

90. Sun’s social media posts and public statements also highlighted increases in

BTT’s price and trading volume, thus promoting BTT trading.  For example, on May 6, 2019,

after TRX fell from a list of “top 10 cryptocurrencies,” Sun stoked continued interest in TRX and

BTT on Twitter, tweeting: “#TRON will be back to Top 10 in June!  #BitTorrent will be Top 30

5  “Staking” concerns the “proof of stake” validation protocols that certain blockchains utilize.  These
protocols offer rewards to those who “validate”—or confirm—transactions on the blockchain.  To become a
validator and obtain such rewards, holders of crypto assets must first “stake”—or commit—crypto assets (typically,
the “native” crypto asset on a particular blockchain).  Validators are selected based on the size of their stake, among
other factors, creating an incentive to stake, or commit, greater quantities of crypto assets.  The protocols incentivize
validators to add legitimate transactions to the blockchain because validators are rewarded if they do and could be
penalized if they do not, including by having the staked crypto assets “slashed” (or destroyed).

6  Telegram is a cross-platform messaging application commonly used by crypto asset issuers and promoters
to disseminate information about crypto asset offers and sales to interested parties and potential investors.

 24

in Q2.”  On May 29, 2019, Sun tweeted: “Mission completed.  It is just a beginning.  More to

come,” with a link to a post announcing that TRX had returned to the top 10 and BTT had

entered the top 30 cryptocurrencies.

91. The Sun Defendants announced other perceived milestones for BTT trading in the

secondary market.  For example, in May 2019, Sun tweeted: “$BTT hit the 2nd place with the

highest price increase over the last 24 hours among the TOP100 #Cryptos by Market

Capitalization!”  Similarly, in February 2021, @BitTorrent tweeted that “$BTT Price Hits New

High.  $BTT grew + 151% in 24 hours, +232% in 7 days.  #BTT to the [sic] Mars,” with two

rocket emojis.

92. The @BitTorrent Twitter account also promoted BTT’s “ROI” or “return on

investment” on social media, for example by retweeting a post on July 2, 2019, comparing

BTT’s “current ROI” of “11.16x” to lower ROIs of other tokens also offered through IEOs.

Later, on July 19, 2021, Rainberry promoted BTT’s secondary market performance, highlighting

that “[a]ccording to CryptoRank Platform, #BitTorrent is Top 3 gainer with 751% profits in

2021.”

93. In addition to promoting the BTT secondary market, the Sun Defendants also

worked to make BTT available for trading on numerous crypto asset trading platforms.  Sun, or

others acting at his direction, submitted listing applications to multiple crypto asset trading

platforms, including Bittrex, showing the BitTorrent Foundation as the applicant.

94. The Sun Defendants’ efforts to promote and grow a robust secondary market for

trading in BTT were successful.  According to a December 20, 2019, tweet by @BitTorrent, as

of that date at least 39 crypto asset trading platforms had made BTT available for trading.

 25

95. The availability of BTT on numerous trading platforms allowed investors in the

U.S. to purchase and sell BTT, which they did.  On January 5, 2019, Sun posted a livestream to

YouTube in which he encouraged U.S. investors to “use the bitcoin . . . or any cryptocurrency to

buy the BTT in the future,” despite apparent restrictions on U.S. investors’ participation in the

BTT IEO.  On May 11, 2021, the @BitTorrent Twitter account posted a link to a video by “Mike

Tha Investor” with information “for those who doesn’t [sic] know how to buy #BTT in the U.S.”

IV. The Sun Defendants Engaged in Unregistered BTT Offers and Sales

96. BTT was offered and sold as a security, specifically as an investment contract.

All BTT purchasers, including those who tendered value for BTT other than cash or crypto

assets, invested in a common enterprise alongside the Sun Defendants, who at all times retained

significant BTT holdings.  Because the value of BTT rose or fell together for all holders, all BTT

holders profited or suffered losses in amounts proportionate to their BTT holdings.  As such,

their fortunes—including the realization of future profits—were inextricably tied to those of the

Sun Defendants and each other’s.

97. BTT purchasers’ and holders’ prospective profits also depended largely on the

efforts of the Sun Defendants to develop the BitTorrent protocol, grow public interest in BTT

and TRX, make BTT available for trading on crypto asset trading platforms, and promote BTT to

potential investors to increase its secondary market price for all holders.  And, given the Sun

Defendants’ promotional statements, BTT purchasers and holders reasonably expected that the

value of their investment would largely rise or fall on these efforts to increase BTT’s value.

98. For offers and sales of BTT alleged herein that involved purchasers based in the

United States, irrevocable liability was incurred and title transferred within the United States

because the purchasers were located in the United States when they took the necessary actions to

acquire BTT, including transmitting their purchase orders and payments for TRX (which was

 26

necessary to receive airdrops of BTT) or performing the various promotional activities described

below (which were necessary to receive other distributions of BTT).

99. From at least February 2019 through October 2021, the Sun Defendants offered

and sold BTT in the nine types of unregistered securities transactions described below.

100. No registration statement was ever filed with the SEC or in effect with respect to,

and no exemption from registration was available for, any of these offers and sales of BTT.

Thus, the offers and sales of BTT set forth below violated the registration provisions of the

federal securities laws.

A. Offers and Sales of BTT in Monthly “Airdrops”

101. From on or about February 11, 2019, through June 13, 2020, the Sun Defendants

offered and sold BTT through monthly so-called “airdrops” to TRX holders.

102. In the crypto asset space, an airdrop typically refers to the distribution of crypto

assets to certain recipients, purportedly without requiring them to pay cash consideration for the

asset.  With respect to BTT, however, the recipients had to purchase and hold TRX to be eligible

for airdrops of BTT.  Indeed, anyone who purchased and held TRX in a Tron digital wallet or on

a participating crypto asset trading platform received BTT regardless of their geographic location

or country of citizenship.

103. On January 4, 2019, before the BTT IEO, Sun and the Tron Foundation both

promoted the BTT monthly airdrop program to their followers, tweeting, “Keep decentralizing

the web, tokenizing the world’s largest decentralized file sharing protocol.  Wanna know more

about #BTT @BitTorrent, #BinanceLaunchpad, #niTROnSummit & #BTT airdrop plan?  See

you there at 8:00am, Jan 5th, 2019(PST) (4 hours later).  #TRON to the future.  #TRX.”

 27

104. On January 20, 2019, the BitTorrent Foundation “unveil[ed] more details

regarding BitTorrent (BTT) airdrops for TRON (TRX) holders” in a post to the @BitTorrent

Medium page.  Sun and the Tron Foundation each tweeted a link to the January 20, 2019,

Medium post, simultaneously announcing the plan to “initiate [the] first airdrop of BitTorrent

$BTT to the TRON $TRX holders on February 11th, 2019.”

105. The January 20, 2019, Medium post announced, “On February 11th, 2019,

BitTorrent Foundation will initiate its first airdrop of BitTorrent (BTT) to TRON (TRX) holders.

The snapshot”—a complete record of TRX ownership as of a specific point in time prior to the

airdrop used to identify qualifying airdrop recipients—“will be taken when TRON’s block height

reaches 6.6 million*.  Based on this snapshot, BitTorrent Foundation will initiate its first airdrop

of 10,890,000,000 BitTorrent (BTT), corresponding to 1.1% of total supply.”

106. The January 20, 2019, Medium post further announced, “Over the next 12 months

following this initial airdrop, 11,880,000,000 BTT will be offered to TRX holders,

corresponding to 1.2% of total supply.  In 2020, the BitTorrent Foundation will airdrop

12,870,000,000 BTT, corresponding to 1.3% of the total supply, and over the next six years, the

percentage airdropped will increase by 0.1% per year, reaching 1.7% in 2025.”

107. To receive BTT in these airdrops, recipients had to hold TRX tokens in “official

wallets relaying on TRON’s network,” or in accounts on crypto asset trading platforms

“supporting the airdrops.”  As explained in the January 20, 2019, Medium post, “If you are

holding TRX, you will be eligible for BTT airdrops.  All official wallets relaying on TRON’s

network and carrying TRX will be eligible for BTT airdrops corresponding to the amount they

are holding.  No minimum of TRX is required to qualify for BTT airdrops.”

 28

108. On February 11, 2019, @BitTorrent posted an update to its Medium page

announcing that the “BitTorrent (BTT) Airdrop program for TRON (TRX) holders [has been]

initiated.”  According to this post, “all the addresses running on TRON’s blockchain that have a

TRX balance greater than or equal to 1 TRX” and all investors with “TRX stored on an exchange

or a wallet supporting the official airdrop program” would receive 0.1097681177 BTT for each

TRX held.

109. Following the first monthly BTT airdrops to TRX holders on February 11, 2019,

from March 2019 through February 2020, the Sun Defendants airdropped an additional

990,000,000 additional BTT to TRX holders on or about the 11th day of each month.

110. Two subsequent monthly airdrops of 1,072,500,000 BTT took place on April 11

and May 11, 2020, before the @BitTorrent Medium page announced on June 13, 2020, the end

of the airdrop program: “Today, after 16 rounds of BTT airdrops, BitTorrent Speed enjoys over

12 million monthly active users.  After discussions among the BitTorrent Foundation,

community developers, and community representatives, it is the community’s belief that the

monthly BTT airdrop to TRX holders has achieved its goals, and will discontinue with

immediate effect.”

111. According to the June 13, 2020, post to @BitTorrent’s Medium page, “[t]hrough

May 11, 2020, BTT [] completed 16 rounds of airdrops to TRX holders, airdropping a total of

25,987,500,000 BTT out of the total pool of 99,990,000,000 BTT, allowing millions of TRX

holders to use BTT within the BitTorrent ecosystem.”

112. Anyone who purchased and held TRX in an “official” wallet at the time of each

monthly “snapshot” received BTT regardless of their geographic location or country of

citizenship.  Persons in the United States were not excluded from receiving BTT through the

 29

monthly airdrop program, and in fact the Sun Defendants sent BTT to persons in the United

States via airdrops.

113. In addition to the monthly airdrop program, the January 20, 2019, post to

BitTorrent’s Medium page announced “plans to airdrop additional 99,990,000,000 BTT, during

online and offline events, corresponding to 10% of the total supply.”  Sun, the BitTorrent

Foundation, and Rainberry ultimately offered and sold some of these additional BTT through

various bounty programs, as detailed below.

114. On February 27, 2019, in an “Ask Me Anything” (or “AMA”) session held on the

English language Telegram channel of a crypto asset trading platform, Sun explained the purpose

of the monthly BTT airdrop to TRX holders: “This is a program to give our users early access to

our product, and to encourage them to stick with us for the long term.  We are not only

airdropping to TRX holders, but also giving the BTT token to BitTorrent users through the

clients.  We expect over 100M active users will get to know about cryptocurrency and the first

one they will experience will be BTT.”

115. Sun emphasized the airdrop program’s potential to bring BitTorrent’s 100 million

users into the crypto asset community, stating: “We will provide BTT as an early access

mechanism to the 100 million active users and most of them are not cryptocurrency users.

However, the 100 million users are the targeted users, and they share a lot of similarities with

crypto users.  Firstly, they are interested in decentralized technologies and are using peer-to-peer

technology.  Secondly, the majority of BitTorrent users are males between 25 and 35 years old,

which is also a group very interested in cryptocurrency.  Therefore, when the 100 million users

receive BTT airdrops, they will start to wonder what BTT is, and what cryptocurrency is, and

start to investigate.”

 30

116. Sun also explained that the decision to target BitTorrent’s users with a new token,

BTT, instead of TRX, was intended to avoid “diluting” TRX’s value for existing holders.  “The

BitTorrent user base is huge (~100M MAU), so we can’t provide enough TRX to then bootstrap

the economy without diluting the value of TRX,” said Sun in his February 27, 2019, AMA.  Sun

added: “Since BTT is a TRC-10 token, TRX and BTT are like a razor and a blade.  It’s really

important for me to give access to BTT to the TRON community and reward the TRX holders so

we decided to create a 6 years long program to airdrop 10% of the total circulating supply which

is pretty unique within the crypto space.  The more successful BTT is, the more successful TRX

will be.” (Emphasis added.)

117. By acquiring and holding TRX tokens in exchange for the opportunity to receive

BTT through monthly airdrops, would-be BTT airdrop recipients provided the Sun Defendants

with valuable consideration—(i) increased demand for TRX, (ii) further growth in TRX trading

volume and liquidity on the secondary market, (iii) upward pressure on TRX’s secondary market

price, (iv) promotion of BTT and the BitTorrent platform to TRX’s existing base of engaged

crypto asset investors, and (v) the rapid development of a secondary market for BTT.

B. Offers and Sales of BTT in the “New Year 2020” Distribution

118. From on or about December 23, 2019, through January 1, 2020, the Sun

Defendants offered and sold BTT through an online bounty program they referred to as the “New

Year 2020” distribution.

119. To receive BTT in this distribution, participants had to follow BitTorrent on

Twitter, visit BitTorrent’s page on YouTube, submit online an answer to the question “why do

you use Bit Torrent?” and tag friends’ social media accounts—all forms of publicizing Rainberry

 31

and BTT.  To receive BTT in this distribution, participants also had to have or establish a BTT

wallet address.

120. The Sun Defendants announced this distribution in a December 22, 2019, post to

the @BitTorrent Medium page: “[t]o celebrate the coming of exciting 2020 year, BitTorrent

decides to give away 7 million BTT to BitTorrent community, including a special big prize for

this Christmas.  Each day during the event, 10 winners will be drawn from the selected entries,

starting on December 23[rd].  Because the drawing is done randomly and each user is allowed

multiple entries (see “rules” below), you could win multiple days, or even multiple times each

day!”

121. According to this Medium post, 10 winners chosen daily between December 23,

2019, and January 1, 2020, would each receive 50,000 BTT, with the exception of 10 winners

chosen on December 25, 2019, who would receive “a special big prize for this Christmas” of

250,000 BTT each.

122. On December 23, 2019, @BitTorrent also announced the distribution on Twitter,

with a link to the December 22, 2019, Medium post, as well as a link to a website hosted by a

third party that describes itself as “The Business Growth Platform,” where participants could

submit contest entries.  According to the entry submission page, 40,484 complete entries were

received.

123. By completing the steps required to enter, participants provided the Sun

Defendants with valuable consideration, including advertising and publicity for Rainberry and

BTT, as well as social media handles for entrants and the friends they tagged.  In addition,

participants who had not yet established BitTorrent accounts and corresponding wallets had to do

so, increasing the apparent number of active BitTorrent users and BTT wallet holders.

 32

124. None of the Sun Defendants took any steps to exclude U.S. persons from

receiving BTT in this offering.

C. Offers and Sales of BTT in the BitTorrent “Discord Giveaway”

125. From on or about March 3, 2021, through March 15, 2021, the Sun Defendants

offered and sold BTT through a bounty program they referred to as a “Discord Giveaway.”

126. On or about March 3, 2021, @BitTorrent announced this distribution on Twitter:

“#BitTorrent Discord is now officially launched!  With the launch of our Discord, we prepared 1

Billion $BTT for winners who completed our requests, join here,” with a link to a third party

website where participants could submit contest entries.

127. To receive BTT in this contest, participants had to join the BitTorrent Discord

channel,7 submit entry information on a third-party platform, and engage with BitTorrent’s social

media platforms to earn “points” by following and retweeting posts by BitTorrent on Twitter and

referring friends by providing their social media contact information.

128. According to the entry submission page, 2,691,181 complete entries were

received.  The total distribution of 1,000,000,000 BTT was shared among 300 winners randomly

selected from among all entrants, with the top 10 winners sharing 300,000,000 BTT and the

remaining 290 winners sharing 700,000,000 BTT.

129. By completing the steps required to enter, participants provided the Sun

Defendants with valuable consideration, including (i) growing BitTorrent’s Discord channel, (ii)

promoting BTT and the BitTorrent platform on social media, (iii) increasing apparent

7  Discord is a U.S.-based online platform that describes itself as “a voice, video, and text chat app that’s used
by tens of millions of people . . . to talk and hang out with their communities and friends.”  Discord is commonly
used by crypto asset issuers and promoters to disseminate information about crypto asset offers and sales to
interested parties and potential investors.

 33

engagement with BitTorrent’s social media platforms, and (iv) providing their identifying

information and that of their referred friends for future use by the Sun Defendants.

130. None of the Sun Defendants took any steps to exclude U.S. persons from

receiving BTT in this offering.

D. Offers and Sales of BTT in “1 Million BTT Giveaway”

131. From on or about March 30, 2021, through April 2, 2021, the Sun Defendants

offered and sold additional BTT through a bounty program they referred to as the “1 Million

BTT Giveaway.”

132. On March 29, 2021, @BitTorrent announced the 1 Million BTT distribution on

Twitter: “1,000,000 $BTT Giveaway BitTorrent is launching a series of campaigns to giveaway

1M $BTT to reward #BTT community for supporting us throughout.💕. ✅Follow, Like, RT

✅Tag 3 friends 💙30 lucky winners get 2500 $BTT each.”

133. To become eligible to receive BTT in this distribution, participants had to follow

the @BitTorrent Twitter feed, like or retweet certain BTT-related announcements, and tag three

friends.  Thirty winners randomly selected from among all entrants were each awarded 2,500

BTT.

134. By completing the steps required to enter, participants provided the Sun

Defendants with valuable consideration, including (i) promoting BTT and the BitTorrent

platform on social media and to their tagged friends, (ii) increasing apparent engagement with

BitTorrent’s social media platforms, and (iii) providing their social media contact information

and that of their friends for future use by the Sun Defendants.

135. None of the Sun Defendants took any steps to exclude U.S. persons from

receiving BTT in this offering.

 34

E. Offers and Sales of BTT in the “Design Contest”

136. From on or about March 31, 2021, through April 7, 2021, the Sun Defendants

offered and sold BTT through a bounty program they referred to as a “design contest.”

137. On March 31, 2021, @BitTorrent announced the “design contest” on Twitter,

directing participants to “Free your mind at #BitTorrent Design Contest and win 100,000 $BTT!

✅Create #memes, videos or pics for BitTorrent, #BTT or @justinsuntron   ✅RT + Reply with

your artwork  ✅Top 10 with the most likes will get 10,000 $BTT each.”

138. To receive BTT in this contest, participants had to retweet the contest

announcement along with original content in the form of a meme, video, or picture, tweet

promoting and tagging BitTorrent, BTT, or Sun.  Ten entrants whose tweets received the most

“likes” were awarded 10,000 BTT each.

139. By completing the steps required to enter, participants provided the Sun

Defendants with valuable consideration, including (i) original promotional artwork, (ii) the

promotion of BTT and the BitTorrent platform on social media, and (iii) increased apparent

engagement with BitTorrent’s Twitter account.

140. None of the Sun Defendants took any steps to exclude U.S. persons from

receiving BTT in this offering.

F. Offers and Sales of BTT in the “April Carnival”

141. From on or about April 6, 2021, through April 20, 2021, the Sun Defendants

offered and sold BTT through a bounty program they referred to as the “April Carnival.”

142. On April 6, 2021, @BitTorrent announced the “BitTorrent April Carnival” on

Medium: “BitTorrent is celebrating BitTorrent April Carnival and launching a 50,000 BTT

 35

Telegram Giveaway in the following two weeks!  Come and win a prize by joining BitTorrent

Telegram and completing the tasks given by the BitTorrent bot!”

143. To be eligible to receive BTT in this contest, participants had to follow

@BitTorrent’s Twitter account and join the BitTorrent Telegram channel, where they then had to

chat with a “bot” to obtain a unique “referral link.”  Participants then had to invite friends to join

the BitTorrent Telegram channel by sharing the referral link.

144. According to the Medium announcement, all entrants who joined the BitTorrent

Telegram channel would share 15,000 BTT, while the first 300 users to complete all required

tasks would share another 15,000 BTT.  An additional 35,000 BTT were shared by the 100

entrants who invited the most new users who then joined the campaign.

145. By completing the steps required to enter, participants provided the Sun

Defendants with valuable consideration, including (i) promoting BTT and the BitTorrent

platform on social media, (ii) growing BitTorrent’s Telegram channel, (iii) increasing apparent

engagement with BitTorrent’s social media platforms, and (iv) providing their social media

contact information and that of their friends for future use by the Sun Defendants.

146. None of the Sun Defendants took any steps to exclude U.S. persons from

receiving BTT in this offering.

G. Offers and Sales of BTT in Sun’s AMA Distribution

147. From on or about May 25, 2021 through June 2, 2021, the Sun Defendants offered

and sold BTT through a bounty program connected to a May 28, 2021 AMA session on

BitTorrent’s Telegram channel, featuring the COO of an Indonesia-based crypto asset trading

platform.

 36

148. As @BitTorrent announced in a May 25, 2021, tweet, individuals could become

eligible to receive BTT in this distribution by participating in the AMA session and submitting

questions in the comments section to be answered during the session.  The Sun Defendants

distributed an unknown number of BTT tokens to the eight contest winners selected randomly

from among all entrants.

149. By completing the steps required to enter, participants provided the Sun

Defendants with valuable consideration, including growing BitTorrent’s Telegram channel, and

increasing apparent engagement with BitTorrent’s social media platforms.

150. None of the Sun Defendants took any steps to exclude U.S. persons from

receiving BTT in this offering.

H. Offers and Sales of BTT in the 800 Million BitTorrent Discord “Giveaway”

151. From on or about June 9, 2021, through June 11, 2021, the Sun Defendants

offered and sold BTT through a bounty program they referred to as a Discord “giveaway.”

152. On June 9, 2022, @BitTorrent announced the 800,000,000 BTT Giveaway on

Twitter: “800 Million $BTT Giveaway is now live on #BitTorrent Discord!  🎁We are hosting a

special giveaway with a huge prize pool.  To be eligible, Please join our Discord via gleam for

full information!.”

153. To receive BTT in this contest, participants had to join the BitTorrent Discord

channel, submit entry information on a third-party platform, and engage with BitTorrent’s social

media platforms to earn “points” by following and retweeting posts by BitTorrent on Twitter,

and referring friends by providing their social media contact information.

154. According to the entry submission page, 1,510 completed entries were received.

A distribution of 650,000,000 BTT was shared among all entrants, with 150 winners selected

 37

from among all entrants to share another 150,000,000 BTT.

155. By completing the steps required to enter, participants provided the Sun

Defendants with valuable consideration, including (i) growing BitTorrent’s Discord channel, (ii)

promoting BTT and the BitTorrent platform on social media, (iii) increasing apparent

engagement with BitTorrent’s social media platforms, and (iv) providing their identifying

information and that of their referred friends for future use the Sun Defendants.

156. None of the Sun Defendants took any steps to exclude U.S. persons from

receiving BTT in this offering.

I. Offers and Sales of BTT in the “Golden Wallet Sweepstakes”

157. From on or about September 7, 2021, through October 11, 2021, the Sun

Defendants offered and sold BTT through a bounty program they referred to as the “Golden

Wallet Sweepstakes.”

158. In a September 7, 2021, post on Medium, @BitTorrent announced the Golden

Wallet Sweepstakes, in which “four lucky winners will receive 1M BTT, and one grand prize

winner will receive 10M BTT.”

159. To become eligible to receive BTT in this distribution, participants had to “enter

by downloading the free or Pro version of any BitTorrent or µTorrent client that contains a

BitTorrent Speed wallet, then activat[e] the Golden Wallet Sweepstakes following the steps

outlined when launching BitTorrent Speed for the first time.”

160. By completing the steps required to enter, each participant provided the Sun

Defendants with valuable consideration by becoming a new BitTorrent client user and growing

BitTorrent’s active user base.

 38

161. None of the Sun Defendants took any steps to exclude U.S. persons from

receiving BTT in this offering.

V. The Sun Defendants Engaged in Manipulative Trading of TRX

162. From approximately February 2018 through February 2019, Sun led a team of at

least three Tron Foundation employees and two Rainberry employees in a scheme to artificially

inflate the trading volume of TRX through wash trading between accounts controlled by the

BitTorrent Foundation, Tron and Rainberry employees, and ultimately Sun.  Sun, and those who

helped him carry out this scheme, acted intentionally or recklessly at all relevant times.

163. Wash trading generally refers to “trades that occur without a change in beneficial

ownership.”  SEC v. Williky, 942 F.3d 389, 391 (7th Cir. 2019).  Wash trading is fraudulent

because it creates a “false perception of market activity that does not reflect the true supply and

demand for the securities.”  Id.

164. Sun’s team conducted the wash trading of TRX on at least Bittrex, which was

based in the United States.  At all relevant times, Sun directed and was aware of his team’s wash

trading.

165. As described herein, the wash-trading scheme involved significant conduct within

the United States.  In addition, to the extent that Sun, or the Tron Foundation or Rainberry

employees acting at his direction, were physically located outside the United States when they

conducted any part of the wash-trading scheme, their actions had a foreseeable and substantial

effect within the United States because, among other things, the wash trading took place on

Bittrex trading platform, which was based in the United States.  Moreover, because Sun, the

Tron Foundation, and Rainberry had created a market for TRX in the United States through their

promotions and sales of TRX to United States investors, their manipulative wash trading of TRX

 39

had a direct and foreseeable effect on the United States market for TRX, including on the

investors in the United States who had purchased TRX.

166. Through this wash-trading scheme, Sun and his team intentionally or recklessly

created the false and misleading appearance of legitimate, active TRX trading.  By this scheme,

Sun and his team engaged in a series of transactions that created actual, active trading for the

purposes of inducing the purchase or sale of TRX by others and making it easier for Sun and the

Tron Foundation to sell TRX while keeping its price stable.  The scheme also involved other

deceptive conduct, which was carried out intentionally or recklessly, as set forth below.

A. Sun’s Team Opened Nominee Accounts on Bittrex to Manipulate the Market
for TRX

167. Between about February 23 and March 27, 2018, Sun directed Tron Foundation

employees to open nominee accounts on multiple crypto asset trading platforms, including

Bittrex.  As described below, Sun’s team opened four accounts on Bittrex that were used to wash

trade.

168. On or about March 27, 2018, Sun’s team opened two accounts on Bittrex in the

names of Chinese nationals, one of whom was Sun’s father.  Those accounts were labeled

“Account 16” and “Account 17.”

169. On or about April 6, 2018, the Tron Foundation electronically transmitted to

Bittrex an “Authorized Trader Letter,” which stated that several accounts, including Account 16

and Account 17, were “authorized by SUN YUCHEN [Justin Sun],” the “Founder and CEO of

Tron Foundation.”  (Bracketed text added.)  The Authorized Trader Letter was signed by Sun

and dated April 6, 2018.

 40

170. On or about August 26, 2018, Sun’s team opened a third account Bittrex in the

name of a U.S.-based Rainberry employee (“U.S. Nominee One”).  That account was labeled the

“Activity Account.”

171. On or about September 17, 2018, Sun, U.S. Nominee One, and Rainberry’s Chief

Financial Officer (“CFO”), among others, attended a “global executive meeting.”  During that

meeting, and as part of the wash-trading scheme, Sun approved a wire transfer of $10,000 into

U.S. Nominee One’s personal account.  In approving the transfer, Sun knew or was reckless in

not knowing that the $10,000 would subsequently be passed from U.S. Nominee One’s personal

account to the Activity Account and used for wash trading.

172. The next day, September 18, 2018, Rainberry’s CFO also approved the $10,000

wire transfer and instructed his Rainberry staff to make the transfer to U.S. Nominee One.

Rainberry staff complied, making payment from a U.S.-based bank account in Rainberry’s name.

173. On or about September 20, 2018, Sun’s team opened a fourth account on Bittrex

in the name of another U.S.-based Rainberry employee (“U.S. Nominee Two”).  That account

was labeled the “Bancor Account.”

174. The Bancor Account was opened by Sun’s team, acting at Sun’s direction, using a

screen-shot photograph of U.S. Nominee Two and certain of U.S. Nominee Two’s personal

information, without U.S. Nominee Two’s knowledge or permission.

B. At Sun’s Direction, His Team Engaged in Wash Trading on Bittrex

175. Sun controlled the digital wallets and the TRX tokens used to conduct the wash-

trading scheme on Bittrex.  Sun also directed the team of Tron Foundation employees who

executed the wash trades.  The team kept Sun informed of their activities to ensure that they were

trading consistent with his directives.

176. Starting in or about September 2018, Sun received weekly reports detailing his

team’s wash-trading activities.  One weekly report dated September 28, 2018, advised Sun that

the “USD trading pair has started,” referring to the Activity and Bancor Accounts that began

wash trading on September 26, 2018.  That report also stated that Sun’s team intended “to sell

TRX” and then would “set up a buying opportunity after the holidays to balance the demand of

the currency (stabilize profits and losses).”

177. Another report dated October 30, 2018, stated that Sun’s team would adjust its

strategy to respond to the drop in “natural,” i.e., legitimate, TRX trading volume.  That report

also conveyed Sun’s directive that the team increase TRX trading volume: “The boss reminded

us of the need to increase trade volume, we need to increase the liquid parameter next week,

concentrate on binance, bittrex, bithumb, upbit exhanges [sic], increase the daily budget to 2.5

BTC.”

178. The wash-trading scheme depended, at least in part, on a significant supply of

TRX.  Sun thus provided his own TRX to his team to facilitate the wash trading.

179. From about April 18, 2018, through February 11, 2019, Sun’s team engaged in

wash trades of TRX on Bittrex using Accounts 16 and 17.  During the 249 days when those

accounts were active, Sun’s team engaged in at least 609,790 wash trades of TRX, averaging

about 2,449 wash trades per day.

180. For example, the table below illustrates the wash trading of TRX between

Accounts 16 and 17 on October 1, 2018:

Time Buying Account TRX Qty Price Currency Selling Account

10/01/2018 08:21:04 Account 16 5,455 0.02210007 USDT Account 17

10/01/2018 08:21:40 Account 17 6,368 0.02210005 USDT Account 16

10/01/2018 08:22:36 Account 16 5,593 0.02210016 USDT Account 17

10/01/2018 08:23:21 Account 17 5,407 0.02210011 USDT Account 16

 42

Time Buying Account TRX Qty Price Currency Selling Account

10/01/2018 08:24:02 Account 16 4,322 0.02210019 USDT Account 17

10/01/2018 08:24:40 Account 17 5,609 0.02210012 USDT Account 16

10/01/2018 08:25:23 Account 16 6,104 0.02210004 USDT Account 17

10/01/2018 08:26:10 Account 17 4,883 0.02210019 USDT Account 16

10/01/2018 08:26:43 Account 16 5,550 0.02210012 USDT Account 17

10/01/2018 08:27:38 Account 17 5,171 0.02210018 USDT Account 16

10/01/2018 08:28:24 Account 16 3,310 0.02210010 USDT Account 17

10/01/2018 08:29:11 Account 17 6,438 0.02210003 USDT Account 16

10/01/2018 08:30:02 Account 16 4,854 0.02210010 USDT Account 17

10/01/2018 08:30:51 Account 16 4,829 0.02210008 USDT Account 17

10/01/2018 08:31:51 Account 17 5,409 0.02210007 USDT Account 16

10/01/2018 08:32:09 Account 16 1,103 0.00000335 BTC Account 17

10/01/2018 08:32:39 Account 16 2,330 0.02210016 USDT Account 17

10/01/2018 08:33:08 Account 17 854 0.00000335 BTC Account 16

10/01/2018 08:33:15 Account 17 3,752 0.02210013 USDT Account 16

10/01/2018 08:34:02 Account 16 1,280 0.00000335 BTC Account 17

10/01/2018 08:34:04 Account 16 5,286 0.02210004 USDT Account 17

10/01/2018 08:34:53 Account 17 3,856 0.02210005 USDT Account 16

10/01/2018 08:35:27 Account 16 4,771 0.02210015 USDT Account 17

10/01/2018 08:36:08 Account 17 1,602 0.02210016 USDT Account 16

10/01/2018 08:36:46 Account 17 3,457 0.02210005 USDT Account 16

10/01/2018 08:37:45 Account 16 3,539 0.02210003 USDT Account 17

10/01/2018 08:38:31 Account 17 3,208 0.02210016 USDT Account 16

10/01/2018 08:39:03 Account 16 3,293 0.02210013 USDT Account 17

10/01/2018 08:39:39 Account 17 1,845 0.02210008 USDT Account 16

10/01/2018 08:40:18 Account 17 3,791 0.02210001 USDT Account 16

10/01/2018 08:41:00 Account 16 2,029 0.02210019 USDT Account 17

10/01/2018 08:41:07 Account 17 1,288 0.00000334 BTC Account 16

10/01/2018 08:41:42 Account 16 1,699 0.02210018 USDT Account 17

10/01/2018 08:41:50 Account 16 1,086 0.00000334 BTC Account 17

10/01/2018 08:42:29 Account 16 1,000 0.00000334 BTC Account 17

10/01/2018 08:42:39 Account 17 3,465 0.02210010 USDT Account 16

10/01/2018 08:43:19 Account 17 1,499 0.00000334 BTC Account 16

10/01/2018 08:43:39 Account 16 3,472 0.02210019 USDT Account 17

10/01/2018 08:43:53 Account 16 633 0.00000334 BTC Account 17

10/01/2018 08:44:27 Account 16 3,271 0.00000334 BTC Account 17

10/01/2018 08:44:32 Account 17 2,767 0.02210009 USDT Account 16

10/01/2018 08:45:05 Account 17 2,068 0.00000335 BTC Account 16

10/01/2018 08:45:34 Account 16 3,320 0.02210002 USDT Account 17

10/01/2018 08:45:52 Account 17 2,570 0.00000335 BTC Account 16

 43

Time Buying Account TRX Qty Price Currency Selling Account

10/01/2018 08:46:17 Account 17 3,689 0.02210015 USDT Account 16

10/01/2018 08:46:54 Account 16 2,050 0.00000335 BTC Account 17

10/01/2018 08:47:15 Account 16 2,201 0.02200049 USDT Account 17

10/01/2018 08:47:45 Account 17 1,652 0.00000335 BTC Account 16

10/01/2018 08:48:13 Account 16 3,707 0.02200132 USDT Account 17

10/01/2018 08:48:47 Account 16 3,482 0.00000335 BTC Account 17

10/01/2018 08:49:05 Account 17 2,192 0.02200140 USDT Account 16

10/01/2018 08:49:49 Account 17 4,330 0.00000335 BTC Account 16

10/01/2018 08:49:49 Account 17 1,496 0.02200185 USDT Account 16

10/01/2018 08:50:34 Account 16 4,119 0.00000335 BTC Account 17

10/01/2018 08:50:43 Account 16 1,712 0.02200213 USDT Account 17

10/01/2018 08:51:12 Account 17 2,072 0.00000335 BTC Account 16

10/01/2018 08:51:29 Account 17 3,056 0.02200229 USDT Account 16

10/01/2018 08:52:59 Account 16 1,711 0.02206305 USDT Account 17

10/01/2018 08:53:43 Account 17 3,390 0.02206323 USDT Account 16

10/01/2018 08:54:26 Account 16 3,434 0.02206351 USDT Account 17

10/01/2018 08:55:17 Account 17 3,429 0.02206397 USDT Account 16

10/01/2018 08:55:55 Account 16 1,720 0.02206439 USDT Account 17

10/01/2018 08:56:42 Account 16 2,120 0.02206474 USDT Account 17

10/01/2018 08:57:15 Account 17 1,790 0.02206493 USDT Account 16

10/01/2018 08:58:06 Account 16 2,741 0.02206512 USDT Account 17

10/01/2018 08:58:40 Account 17 2,156 0.02206531 USDT Account 16

10/01/2018 08:59:25 Account 17 1,956 0.02206574 USDT Account 16

10/01/2018 09:00:01 Account 16 3,145 0.02206609 USDT Account 17

10/01/2018 09:00:32 Account 17 3,509 0.02221900 USDT Account 16

181. Between September 26 and October 18, 2018, Sun’s team also engaged in wash

trades of TRX using the Activity and Bancor Accounts.  During those 23 days, Sun’s team

engaged in at least 5,426 wash trades of TRX, averaging about 236 wash trades per day.

182. For example, the table below illustrates the wash trading of TRX between the

Activity and Bancor accounts on October 7, 2018:

Time Buyer Account TRX Qty Price Currency Seller  Account

10/07/2018 10:59:19 Bancor Account 1,857 0.02400000 USD Activity Account

10/07/2018 11:00:40 Activity Account 1,857 0.02400000 USD Bancor Account

10/07/2018 11:01:42 Bancor Account 2,219 0.02400000 USD Activity Account

10/07/2018 11:03:21 Activity Account 2,422 0.02400000 USD Bancor Account

 44

Time Buyer Account TRX Qty Price Currency Seller  Account

10/07/2018 11:04:33 Bancor Account 1,960 0.02400000 USD Activity Account

10/07/2018 11:06:01 Activity Account 1,154 0.02400000 USD Bancor Account

10/07/2018 11:07:32 Activity Account 2,537 0.02400000 USD Bancor Account

10/07/2018 11:09:29 Bancor Account 2,712 0.02400000 USD Activity Account

10/07/2018 11:10:38 Activity Account 2,503 0.02400000 USD Bancor Account

10/07/2018 11:12:33 Bancor Account 2,011 0.02400000 USD Activity Account

10/07/2018 11:14:03 Activity Account 1,683 0.02400000 USD Bancor Account

10/07/2018 11:15:55 Bancor Account 1,159 0.02400000 USD Activity Account

10/07/2018 11:17:22 Bancor Account 1,099 0.02400000 USD Activity Account

10/07/2018 11:19:03 Activity Account 1,048 0.02400000 USD Bancor Account

10/07/2018 11:20:53 Bancor Account 2,119 0.02400000 USD Activity Account

10/07/2018 11:22:43 Activity Account 2,477 0.02400000 USD Bancor Account

10/07/2018 11:23:59 Bancor Account 2,600 0.02400000 USD Activity Account

10/07/2018 11:25:18 Activity Account 1,518 0.02400000 USD Bancor Account

10/07/2018 11:26:47 Activity Account 1,963 0.02400000 USD Bancor Account

10/07/2018 11:28:42 Bancor Account 1,130 0.02400000 USD Activity Account

10/07/2018 11:30:39 Bancor Account 2,438 0.02400000 USD Activity Account

10/07/2018 11:32:15 Activity Account 1,672 0.02400000 USD Bancor Account

10/07/2018 11:33:25 Activity Account 2,371 0.02400000 USD Bancor Account

10/07/2018 11:34:43 Bancor Account 2,008 0.02400000 USD Activity Account

10/07/2018 11:36:40 Activity Account 1,023 0.02400000 USD Bancor Account

10/07/2018 11:38:23 Bancor Account 1,581 0.02400000 USD Activity Account

10/07/2018 11:40:05 Activity Account 1,323 0.02400000 USD Bancor Account

10/07/2018 11:41:16 Bancor Account 1,817 0.02400000 USD Activity Account

10/07/2018 11:43:01 Activity Account 1,975 0.02400000 USD Bancor Account

10/07/2018 11:44:51 Bancor Account 2,794 0.02400000 USD Activity Account

10/07/2018 11:45:56 Activity Account 2,530 0.02400000 USD Bancor Account

10/07/2018 11:46:58 Bancor Account 2,437 0.02400000 USD Activity Account

10/07/2018 11:49:00 Activity Account 2,574 0.02400000 USD Bancor Account

10/07/2018 11:50:25 Bancor Account 1,610 0.02400000 USD Activity Account

10/07/2018 11:52:06 Activity Account 974 0.02400000 USD Bancor Account

10/07/2018 11:53:41 Bancor Account 1,483 0.02400000 USD Activity Account

10/07/2018 11:54:56 Activity Account 1,530 0.02400000 USD Bancor Account

10/07/2018 11:56:00 Bancor Account 1,814 0.02400000 USD Activity Account

10/07/2018 11:57:17 Activity Account 670 0.02400000 USD Bancor Account

10/07/2018 11:59:03 Activity Account 1,803 0.02400000 USD Bancor Account

10/07/2018 12:00:30 Bancor Account 634 0.02400000 USD Activity Account

10/07/2018 12:01:55 Bancor Account 1,090 0.02400000 USD Activity Account

10/07/2018 12:03:52 Activity Account 1,643 0.02400000 USD Bancor Account

10/07/2018 12:05:42 Bancor Account 692 0.02400000 USD Activity Account

 45

Time Buyer Account TRX Qty Price Currency Seller  Account

10/07/2018 12:07:01 Activity Account 683 0.02400000 USD Bancor Account

10/07/2018 12:08:34 Bancor Account 830 0.02400000 USD Activity Account

10/07/2018 12:09:38 Activity Account 1,792 0.02400000 USD Bancor Account

10/07/2018 13:08:39 Bancor Account 1,805 0.02400000 USD Activity Account

10/07/2018 14:51:32 Activity Account 2,227 0.02500000 USD Bancor Account

10/07/2018 15:06:00 Bancor Account 1,339 0.02500000 USD Activity Account

10/07/2018 15:07:16 Activity Account 3,107 0.02500000 USD Bancor Account

10/07/2018 16:03:39 Activity Account 3,529 0.02600000 USD Bancor Account

10/07/2018 23:04:34 Bancor Account 1,416 0.02600000 USD Activity Account

10/07/2018 23:11:44 Activity Account 1,286 0.02700000 USD Bancor Account

10/07/2018 23:12:48 Bancor Account 1,403 0.02700000 USD Activity Account

10/07/2018 23:14:49 Activity Account 2,107 0.02700000 USD Bancor Account

10/07/2018 23:22:54 Activity Account 1,746 0.02700000 USD Bancor Account

10/07/2018 23:24:16 Bancor Account 956 0.02700000 USD Activity Account

10/07/2018 23:25:18 Bancor Account 1,274 0.02700000 USD Activity Account

10/07/2018 23:26:57 Activity Account 1,249 0.02700000 USD Bancor Account

10/07/2018 23:33:39 Bancor Account 1,905 0.02700000 USD Activity Account

10/07/2018 23:35:15 Activity Account 2,030 0.02700000 USD Bancor Account

10/07/2018 23:49:33 Bancor Account 1,576 0.02700000 USD Activity Account

10/07/2018 23:50:49 Activity Account 2,845 0.02700000 USD Bancor Account

10/07/2018 23:51:52 Bancor Account 1,996 0.02700000 USD Activity Account

10/07/2018 23:52:54 Activity Account 2,959 0.02700000 USD Bancor Account

10/07/2018 23:59:18 Bancor Account 2,059 0.02700000 USD Activity Account

183. As illustrated in the tables above, the two account pairs—(1) Accounts 16 and 17

and (2) the Activity and Bancor Accounts—engaged in numerous wash trades of TRX on

Bittrex.

184. As reflected in a December 2018 application filed by the BitTorrent Foundation to

make BTT available for trading on a new trading platform, the BitTorrent Foundation also

owned and controlled Accounts 16 and 17.

185. At all relevant times, Sun, acting through the Tron Foundation, the BitTorrent

Foundation, and Rainberry, controlled each of the wash-trading accounts, and the trades of TRX

in those accounts were executed at Sun’s direction and with his knowledge.  None of the TRX

 46

trades between those accounts involved any change in beneficial ownership or had any legitimate

economic purpose.

186. A reasonable investor considering whether to buy or sell TRX would have

deemed it important to know that the trading volume of TRX was affected and inflated by wash

trading.  But Sun and the rest of the Sun Defendants did not disclose that fact.

VI. The Sun Defendants Orchestrated a Celebrity Touting Campaign and Sun Lied to
Conceal It

187. Beginning in or about January 2021, Sun, acting on behalf of the Tron

Foundation, the BitTorrent Foundation, and Rainberry, began paying celebrities located in the

United States, including Defendants Mahone and Way, among others, to promote TRX and BTT

on social media.  Each of the celebrities who touted TRX or BTT had at least one million

followers on their social media accounts, including followers located in the United States.  But

the celebrities did not disclose the fact that they were paid to tout TRX or BTT or the amounts of

the payments they received.

188. Sun, acting on behalf of the Tron Foundation, the BitTorrent Foundation, and

Rainberry, approved the payments to the celebrities for their touts of TRX or BTT, respectively,

and he funded the payments with his own assets.  Sun, working with a Rainberry employee (the

“Rainberry Employee”), arranged payments to the celebrities based in the United States who

touted TRX and/or BTT.  Additionally, Sun instructed the Rainberry Employee to ensure that

those celebrities did not disclose the fact that they were paid to tout the tokens.  Sun’s directive

was communicated to the celebrities directly or indirectly through intermediaries, including the

Rainberry Employee.

189. Sun or the Rainberry Employee acting at his direction, each acting on behalf of

the Tron Foundation, the BitTorrent Foundation, and Rainberry, provided or approved the

 47

specific language that Sun wanted each celebrity to post online to tout TRX and BTT.  Sun then

amplified the celebrities’ promotional posts on social media by commenting on those posts or

retweeting them to Sun’s more than three million Twitter followers, including followers located

in the United States.

190. Sun, acting on behalf of the Tron Foundation, the BitTorrent Foundation, and

Rainberry, thus created the misleading impression that celebrities were independently interested

in investing in TRX and/or BTT.  In fact, the celebrities only touted TRX and/or BTT because

they were paid to do so.

191. On or about January 22, 2021, Way tweeted: “thanks guys, bought some … TRX

… 💪 what’s next? let’s go ✔.”  Later, on or about January 28, 2021, Sun and Way exchanged

electronic messages on Twitter, and Sun stated that he sent Way a payment in the form of crypto

assets.  The next day, on or about January 29, 2021, Way tweeted: “✔$trx = fast blockchain.”

The Tron Foundation, through either Sun or the Rainberry Employee acting at his direction,

provided the language for Way’s tweets, and, as noted above, Sun paid Way for his promotional

tweets with crypto assets that were worth approximately $10,000.  But neither of Way’s tweets

disclosed the fact that Way had been paid to tout TRX or the amount of his payment.

192. On or about February 11, 2021, an American actress tweeted: “Exploring #DeFi

and already liking $JST, $SUN on $TRX.  Super fast and 0 fee.  Good job @ justinsuntron.”

That same day, another American actress based in the United States tweeted: “People should use

only $TRX cause it’s fast, cheap and hot . . . thanks @justinsuntron.”  The Tron Foundation,

through either Sun or the Rainberry Employee acting at his direction, provided the language for

each of those tweets.  Also that same day, an American singer based in the United States

tweeted: “What’s an ideal crypto bag?  Thinking $TRX $BTT $JST $SUN $WIN.”  The Tron

 48

Foundation and BitTorrent Foundation, through either Sun or the Rainberry Employee acting at

his direction, provided the language for each of those tweets.  Sun arranged for these three

celebrities to be paid $10,000, $955.70, and $12,000, respectively, for their tweets.  None of

those tweets, however, disclosed the fact that the celebrities were paid to tout TRX or BTT or the

amounts the payments.

193. The next day, on or about February 12, 2021, Mahone tweeted: “When $TRX hits

50 cents and $BTT hits 1 cent I’m getting a tattoo of @justinsuntron’s face.”  The Tron

Foundation and BitTorrent Foundation, through either Sun or the Rainberry Employee acting at

his direction, provided the language for Mahone’s tweet, and Sun arranged for Mahone to be

paid bitcoin valued at approximately $7,507 for the tweet.  Mahone’s tweet did not disclose the

fact that he had been paid to tout TRX or BTT or the amount of his payment.

194. To conceal the truth about the celebrity touting campaign from the investing

public, Sun falsely denied that he and the Tron Foundation paid celebrities to tout.  On or about

February 16, 2021, Sun tweeted: “There have been rumors lately of third party celebrities being

paid to promote #TRON.  #TRON Foundation is not involved in these activities.  Nor is the

foundation aware of the actors behind this.”  That same day, about one minute later, Sun

tweeted: “If any celebrities are paid to promote TRON, we require them to disclose.”

195. Those tweets by Sun were false.  In fact, as Sun knew, celebrities were paid to

tout TRX and BTT; the Tron Foundation and BitTorrent Foundation, through either Sun or the

Rainberry Employee acting at his direction, provided the language for the touts; Sun arranged

and funded payments to the celebrities for the touts; and the celebrities did not disclose the fact

that they were paid to tout TRX or BTT or the amounts of their payments.

 49

196. A reasonable investor considering whether to buy or sell TRX or BTT would have

deemed it important to know that celebrities were paid to promote TRX and BTT.  But the

celebrities’ promotional statements did not disclose their payments, and Sun’s false statements

further concealed those payments from the investing public.

FIRST CLAIM FOR RELIEF

Violation of Sections 5(a) and (c) of the Securities Act
(Against Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry)

197. Paragraphs 1 through 199 above are re-alleged and incorporated by reference.

198. By their conduct alleged herein, the Sun Defendants, directly or indirectly,

without a registration statement filed and in effect as to securities, (a) made use of the means and

instruments of transportation or communications in interstate commerce or of the mails to sell

securities through the use of any prospectus or otherwise; (b) carried or caused to be carried

through the mails or in interstate commerce, by any means or instruments of transportation,

securities for the purpose of sale or for delivery after sale; and (c) made use of the means and

instruments of transportation or communication in interstate commerce or of the mails to offer to

sell securities through the use or medium of a prospectus or otherwise.

199. The Sun Defendants thus violated, and unless restrained and enjoined will

continue to violate, Sections 5(a) and (c) of the Securities Act, 15 U.S.C. § 77e(a) and (c).

SECOND CLAIM FOR RELIEF

Violation of Sections 17(a)(1) and (a)(3) of the Securities Act
(Against Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry)

200. Paragraphs 1 through 199 above are re-alleged and incorporated by reference.

201. By their conduct alleged herein, the Sun Defendants, in the offer or sale of

securities, by the use of means or instrumentalities of transportation or communication in

 50

interstate commerce or by use of the mails, directly or indirectly:  (1) knowingly or recklessly

employed devices, schemes, or artifices to defraud; and (2) knowingly, recklessly, or negligently

engaged in transactions, practices, or courses of business which operated or would operate as a

fraud or deceit upon the purchaser.

202. The Sun Defendants thus violated, and unless restrained and enjoined will

continue to violate, Sections 17(a)(1) and (a)(3) of the Securities Act, 15 U.S.C. § 77q(a)(1) and

(a)(3).

THIRD CLAIM FOR RELIEF

Violation of Sections 9(a)(1) and (a)(2) of the Exchange Act
(Against Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry)

203. Paragraphs 1 through 199 above are re-alleged and incorporated by reference.

204. By their conduct alleged herein, the Sun Defendants, directly or indirectly, by the

use of the mails or any means or instrumentality of interstate commerce, or of a facility of any

national securities exchange, (1) for the purpose of creating a false or misleading appearance of

active trading in any security, or a false or misleading appearance with respect to the market for

any such security, (A) effected transactions in securities that involved no change in the beneficial

ownership thereof, and (B) entered orders for the purchase of securities with the knowledge that

orders of substantially the same size, at substantially the same time, and at substantially the same

price, for the sale of such securities, had been or would be entered by or for the same or different

parties, and (C) entered orders for the sale of securities with the knowledge that orders of

substantially the same size, at substantially the same time, and at substantially the same price, for

the purchase of such securities, had been or would be entered by or for the same or different

parties; and (2) effected, alone or with one or more other persons, a series of transactions in

securities registered on a national securities exchange, any security not so registered, or in

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connection with any security-based swap or security-based swap agreement with respect to such

security, creating actual or apparent active trading in such securities, or raising or depressing the

price of such securities, for the purpose of inducing the purchase or sale of such securities by

others.

205. The Sun Defendants thus violated, and unless restrained and enjoined will

continue to violate, Sections 9(a)(1) and (a)(2) of the Exchange Act, 15 U.S.C. § 78i(a)(1) and

(a)(2).

FOURTH CLAIM FOR RELIEF

Violation of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder
(Against Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry)

206. Paragraphs 1 through 199 above are re-alleged and incorporated by reference.

207. By their conduct alleged herein, the Sun Defendants, directly or indirectly, in

connection with the purchase or sale of securities, by the use of the means or instrumentalities of

interstate commerce or of the mails, or of any facility of any national securities exchange,

knowingly or recklessly, (a) employed devices, schemes, or artifices to defraud; (b) made untrue

statements of material fact or omitted to state material facts necessary in order to make the

statements made, in the light of the circumstances under which they were made, not misleading;

and (c) engaged in acts, practices, or courses of business which operated or would operate as a

fraud or deceit upon any person.

208. The Sun Defendants thus violated, and unless restrained and enjoined will

continue to violate, Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5

thereunder, 17 C.F.R. § 240.10b-5.

 52

FIFTH CLAIM FOR RELIEF

Violation of Section 17(b) of the Securities Act
(Against Mahone and Way)

209. Paragraphs 1 through 199 above are re-alleged and incorporated by reference.

210. By their conduct alleged herein, Mahone and Way, by the use of any means or

instruments of transportation or communication in interstate commerce or by the use of the

mails, published, gave publicity to, or circulated a notice, advertisement, or communication,

which, though not purporting to offer a security for sale, described a security, for a consideration

received or to be received, directly or indirectly, from an issuer, underwriter, or dealer, without

fully disclosing the receipt of such consideration and the amount thereof.

211. Mahone and Way thus violated, and unless restrained and enjoined will continue

to violate, Section 17(b) of the Securities Act, 15 U.S.C. § 77q(b).

SIXTH CLAIM FOR RELIEF

Aiding and Abetting Violation of Section 17(b) of the Securities Act
(Against Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry)

212. Paragraphs 1 through 199 above are re-alleged and incorporated by reference.

213. As set forth above, by their conduct alleged herein, Mahone and Way, among

other celebrities, violated Section 17(b) of the Securities Act, 15 U.S.C. § 77q(b).

214. The Sun Defendants knowingly or recklessly provided substantial assistance to

Mahone and Way, among other celebrities, in their violations of Section 17(b) of the Securities

Act.

215. The Sun Defendants thus aided and abetted, and unless restrained and enjoined

will continue to aid and abet, violations of Section 17(b) of the Securities Act by celebrities,

including Mahone and Way.

 53

PRAYER FOR RELIEF

Accordingly, the SEC respectfully requests that the Court enter a Final Judgment:

A. Finding that Defendants, except Mahone (who settled with the SEC), committed

the violations alleged in this Complaint;

B. Permanently restraining and enjoining the Sun Defendants from violating

Sections 5(a) and (c) of the Securities Act, 15 U.S.C. § 77e(a) and (c); Sections 17(a)(1) and

(a)(3) of the Securities Act, 15 U.S.C. § 77q(a)(1) and (a)(3); Section 17(b) of the Securities Act,

15 U.S.C. § 77q(b); Sections 9(a)(1) and (a)(2) of the Exchange Act, 15 U.S.C. § 78i(a)(1) and

(a)(2); Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b); and Rule 10b-5 thereunder, 17

C.F.R. § 240.10b-5;

C. Permanently restraining and enjoining Way from violating Section 17(b) of the

Securities Act, 15 U.S.C. § 77q(b);

D. Imposing a conduct-based injunction pursuant to Section 21(d)(5) of the

Exchange Act, 15 U.S.C. § 78u(d)(5), prohibiting the Sun Defendants from participating, directly

or indirectly, including through any entity controlled by them, in any offer or sale of securities,

including any crypto asset security; provided, however, that such injunction shall not prevent

Sun from purchasing or selling non-crypto asset securities for his own personal account;

E. Imposing a conduct-based injunction pursuant to Section 21(d)(5) of the

Exchange Act, 15 U.S.C. § 78u(d)(5), prohibiting Way from receiving or agreeing to receive any

form of compensation or consideration, directly or indirectly, from any issuer, underwriter, or

dealer, for directly or indirectly publishing, giving publicity to, or circulating any notice, circular,

advertisement, newspaper, article, letter, investment service, or communication which, though

not purporting to offer a crypto asset security, for sale, describes such crypto asset security;

 54

F. Permanently prohibiting Sun, pursuant to Section 21(d)(2) of the Exchange Act,

15 U.S.C. § 78u(d)(2), and Section 20(e) of the Securities Act, 15 U.S.C. § 77t(e), from acting as

an officer or director of any issuer that has securities registered pursuant to Section 12 of the

Exchange Act or that is required to file reports pursuant to Section 15(d) of the Exchange Act;

G. Ordering the Sun Defendants to disgorge, jointly and severally, all of the ill-

gotten gains that they received from the violations alleged herein, plus prejudgment interest,

pursuant to Sections 21(d)(3), (5) and (7) of the Exchange Act, 15 U.S.C. §§ 78u(d)(3), (5) and

(7);

H. Ordering Way to disgorge all of the ill-gotten gains that he received from the

violations alleged herein, plus prejudgment interest, pursuant to Sections 21(d)(3), (5) and (7) of

the Exchange Act, 15 U.S.C. §§ 78u(d)(3), (5) and (7);

I. Ordering Defendants, except Mahone (who settled with the SEC), to pay civil

monetary penalties pursuant to Section 20(d) of the Securities Act, 15 U.S.C. § 77t(d), and

Section 21(d)(3) of the Exchange Act, 15 U.S.C. § 78u(d)(3); and

J. Granting such further relief as the Court deems appropriate for the protection of

investors.

JURY DEMAND

The SEC demands a trial by jury on all issues so triable.

Dated:  April 18, 2024   Respectfully submitted,

/s/ Timothy K. Halloran
Timothy K. Halloran (admitted pro hac vice)
Adam B. Gottlieb
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Tel:  202-551-4414 (Halloran)
Email:  [email protected]

UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF NEW YORK 
 

SECURITIES AND EXCHANGE COMMISSION, 
 

Plaintiff, 
 

v. 
 

JUSTIN SUN, TRON FOUNDATION LIMITED, 
BITTORRENT FOUNDATION LTD., 
RAINBERRY, INC., AUSTIN MAHONE, and 
DEANDRE CORTEZ WAY, 
 

Defendants. 
 

  
 
 
 
No. 1:23-cv-02433-ER 
 
JURY TRIAL DEMANDED 
 
 
 

 
AMENDED COMPLAINT 

Plaintiff Securities and Exchange Commission (the “SEC” or “Commission”) submits 

this Amended Complaint as a matter of course, pursuant to Federal Rule of Civil Procedure 

15(a)(1)(B),1 and alleges the following: 

SUMMARY 

1. This action arises from Defendant Justin Sun’s (“Sun”) orchestration of the 

unregistered offer and sale, manipulative trading, and unlawful touting of crypto asset securities. 

2. Working through several companies that he owns and controls—including 

Defendants Tron Foundation Limited (“Tron Foundation”), BitTorrent Foundation Ltd. 

(“BitTorrent Foundation”), and Rainberry, Inc. (“Rainberry,” and collectively with Sun, the Tron 

Foundation, and the BitTorrent Foundation, the “Sun Defendants”)—Sun engineered the offer 

and sale of two crypto asset securities called “TRX” and “BTT.”  Starting around August 2017, 

 
1  A motion to dismiss the original Complaint under Federal Rule of Civil Procedure 12(b) was filed on 
March 28, 2024.  See ECF Nos. 54-56.  Therefore, this Amended Complaint as a matter of course is timely under 
Federal Rule of Civil Procedure 15(a)(1)(B).  The arguments in the motion to dismiss lacked merit, but the SEC has 
alleged additional facts in this Amended Complaint to dispose of those arguments. 

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and continuing thereafter, the Sun Defendants engaged in a scheme to distribute billions of TRX 

and BTT to the public while also creating active secondary markets on which TRX and BTT 

could be traded.   

3. The Sun Defendants offered and sold TRX and BTT as securities and were thus 

required to register those offers and sales with the SEC unless an exemption from registration was 

available.  But they never did so.  Despite engaging in widespread public offers and sales of TRX 

and BTT, and even though no exemption from registration was available, neither Sun nor his 

entities ever filed a registration statement with the SEC. 

4. Sun also directed the manipulative wash trading of TRX to create the artificial 

appearance of legitimate investor interest and keep TRX’s price afloat.  Sun accomplished this wash 

trading through the Tron Foundation, whose employees conducted the trades at Sun’s direction; the 

BitTorrent Foundation, which, together with the Tron Foundation, owned and controlled nominee 

accounts used in the trading; and Rainberry, whose employees transferred funds to facilitate the 

trading and opened at least one nominee account used in the trading.  Sun’s wash-trading team, 

working under his direction, engaged in hundreds of thousands of TRX wash trades between 

accounts that Sun ultimately controlled.  None of those trades involved any change in beneficial 

ownership or had any legitimate economic purpose. 

5. To drive public interest in TRX and BTT, the Sun Defendants created a publicity 

campaign that involved paying celebrities located in the United States, including Defendants 

Austin Mahone (“Mahone”) and DeAndre Cortez Way (“Way”), among others, to promote or tout 

TRX and BTT on their social media accounts, which had millions of followers.  Although the 

celebrities were paid to promote TRX and BTT, their touts on social media did not disclose that 

they had been paid or the amounts of their payments.  Thus, the public was misled into believing 

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that these celebrities had unbiased interest in TRX and BTT and were not merely paid 

spokespersons.   

6. Additionally, Sun materially misrepresented the truth about the touting campaign 

to deceive investors.  In February 2021, Sun stated falsely on social media, “If any celebrities are 

paid to promote TRON, we require them to disclose.”  In fact, Sun himself arranged the 

payments to celebrities and knew those payments were not disclosed.   

7. By their conduct alleged herein, the Sun Defendants violated registration and anti-

fraud provisions of the Securities Act of 1933 (the “Securities Act”), specifically Sections 5(a) and 

(c), 15 U.S.C. §§ 77e(a) and (c), and Sections 17(a)(1) and (3) of the Securities Act, 15 U.S.C. §§ 

77q(a)(1) and (3).  They also violated anti-manipulation and anti-fraud provisions of the Securities 

and Exchange Act of 1934 (the “Exchange Act”), specifically Sections 9(a)(1) and (2), 15 U.S.C. 

§§ 78i(a)(1) and (2), and Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5 

thereunder, 17 C.F.R. § 240.10b-5.  Additionally, they aided and abetted violations of the anti-

touting provision, Section 17(b) of the Securities Act, 15 U.S.C. § 77q(b), by multiple 

celebrities, including Mahone and Way. 

8. By their conduct alleged herein, Mahone and Way violated the anti-touting 

provision, Section 17(b) of the Securities Act, 15 U.S.C. § 77q(b). 

9. Unless restrained and enjoined, Defendants will continue to violate the federal 

securities laws. 

JURISDICTION AND VENUE 

10. The Court has subject matter jurisdiction over this action pursuant to Sections 

20(b), 20(d) and 22(a) of the Securities Act, 15 U.S.C. §§ 77t(b), 77t(d) and 77v(a), and Sections 

21(d) and 27(a) of the Exchange Act, 15 U.S.C. §§ 78u(d) and 78aa(a). 

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11. The Court has personal jurisdiction over Defendants because, through their 

conduct alleged herein, they purposefully took actions in and directed toward the United States.  

For example, among other things, all Defendants promoted TRX and/or BTT to consumers and 

investors located in the United States.  The Sun Defendants also offered and sold TRX and BTT 

in unregistered transactions to individuals located in the United States, and they conducted a 

fraudulent scheme to wash trade TRX on a trading platform based in the United States called 

Bittrex, Inc. (“Bittrex”).  Additionally, in the course of his work on behalf of the Tron 

Foundation, the BitTorrent Foundation, and/or Rainberry, Sun travelled extensively to the United 

States during the time that TRX and BTT were promoted, offered, and sold.  Specifically, Sun 

spent more than 80 days in the United States in 2017, more than 120 days in the United States in 

2018, and approximately 180 days in the United States in 2019.  During Sun’s business trips to 

the United States in 2019, he spent time in various cities, including New York City, Boston, 

Massachusetts, and San Francisco.  Rainberry also rented an apartment where Sun stayed during 

some of his business trips to the United States in 2019. 

12. Venue is proper in this District pursuant to Section 22(a) of the Securities Act, 15 

U.S.C. § 77v(a), and Section 27(a) of the Exchange Act, 15 U.S.C. § 78aa(a), because, among 

other things, some of Defendants’ acts and transactions that violated the federal securities laws 

occurred in this District.  For example, the Sun Defendants offered and sold TRX and/or BTT in 

unregistered securities transactions to multiple investors who resided in this District.  

Additionally, the touting tweets by Mahone and Way described herein, and Sun’s various tweets 

described herein, were sent to Twitter users across the United States, including in this District. 

DEFENDANTS 

13. Defendant Justin Sun (a/k/a Yuchen Sun), age 33, is a Chinese national and 

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crypto asset entrepreneur.  Sun attended college in China and received a post-graduate degree 

from the University of Pennsylvania.  Sun is currently believed to be living in Singapore and/or 

Hong Kong.  At all relevant times, Sun owned, controlled, and dominated the actions and 

dealings of the Tron Foundation, the BitTorrent Foundation, and Rainberry.  As such, those 

entities were Sun’s alter egos.  Additionally, through his actions, Sun blurred the distinctions 

among the Tron Foundation, the BitTorrent Foundation, and Rainberry.  For example, as 

described below, during public appearances that Sun made in San Francisco, California, in 

January 2019, Sun promoted the Tron ecosystem, TRX, and BTT, while simultaneously 

displaying the Tron logo, the Tron name, and the BitTorrent name.  Based on Sun’s actions and 

statements, a reasonable investor considering whether to purchase or sell TRX or BTT would see 

Sun as the face of the Tron ecosystem, TRX, and BTT, and little, if any, meaningful distinction 

among the Tron Foundation, the BitTorrent Foundation, and Rainberry.  With respect to all of his 

conduct alleged herein, Sun acted intentionally or recklessly.   

14. Defendant Tron Foundation Limited was founded by Sun in 2017 as a 

Singapore Public Company Limited by Guarantee.  The Tron Foundation is one of several alter 

ego entities organized by Sun through which he conducted the TRX and BTT offerings and 

managed the development and marketing of the Tron ecosystem.  From 2017 to the present, Sun 

has owned and controlled the Tron Foundation.    

15. Defendant BitTorrent Foundation Ltd. (sometimes d/b/a BitTorrent) was 

founded by Sun in October 2018 as a Singapore Public Company Limited by Guarantee.  The 

BitTorrent Foundation is one of several alter ego entities organized by Sun through which he 

conducted the BTT offerings and managed, together with Rainberry, Inc., the development and 

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marketing of the BitTorrent protocol.  From 2018 to the present, Sun has owned and controlled 

the BitTorrent Foundation. 

16. Defendant Rainberry, Inc. (sometimes d/b/a BitTorrent) is a California 

corporation owned and controlled by Sun.  The corporation was founded in 2004 and operated as 

BitTorrent, Inc. until June 2018, when it was acquired by Sun and renamed Rainberry, Inc.  

From 2018 to the present, Sun has wholly owned and controlled Rainberry, making Rainberry 

another of Sun’s alter ego entities. 

17. Defendant Austin Mahone, age 28, is a U.S. citizen and a singer and songwriter 

residing in Miami, Florida.  At or around the time of his relevant actions alleged herein, Mahone 

had approximately 9.1 million followers on Twitter.2 

18. Defendant DeAndre Cortez Way (a/k/a Soulja Boy), age 33, is a U.S. citizen 

and a singer and record producer residing in Calabasas, California.  At or around the time of his 

relevant actions alleged herein, Way had approximately 5.2 million followers on Twitter. 

BACKGROUND ON SECURITIES OFFERINGS 

19. Congress enacted the Securities Act to regulate the offer and sale of securities.  In 

contrast to commercial principles of caveat emptor (or buyer beware), Congress in the Securities 

Act enacted a regime of full and fair disclosure, requiring those who offer and sell securities to 

the investing public to provide sufficient, accurate information to allow investors to make 

informed decisions before they invest. 

20. Sections 5(a) and 5(c) of the Securities Act generally require an issuer of 

 
2  After the original Complaint was filed, Mahone and the SEC reached a settlement to resolve the SEC’s 
claims against him and, pursuant to that settlement, the Court entered a Final Judgment against Mahone.  See ECF 
Nos. 32 and 33.  This Amended Complaint repeats the SEC’s allegations against Mahone because those allegations 
are part of the fact pattern alleged herein against the other Defendants.  But for the avoidance of doubt, the SEC does 
not seek any further relief against Mahone through this Amended Complaint. 

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securities to register an offering of securities through an effective registration statement before 

the securities are offered and sold to the public.  See 15 U.S.C. § 77e(a) and (c).  Registration 

statements for a securities offering provide public investors with material information about the 

issuer and the securities to be offered and sold. 

21. Section 2(a)(1) of the Securities Act defines “security” to include a wide range of 

investment vehicles, including an “investment contract.”  15 U.S.C. § 77b(a)(1).  An investment 

contract, for purposes of the Securities Act, includes any “contract, transaction or scheme 

whereby a person invests his money in a common enterprise and is led to expect profits” from 

the efforts of others.  SEC v. W.J. Howey Co., 328 U.S. 293, 298-99 (1946).  This broad 

definition is “flexible” and “capable of adaptation to meet the countless and variable schemes 

devised by those who seek the use of the money of others on the promise of profits.”  Id. at 299.  

Courts have found that many types of investments, including crypto assets, may constitute 

investment contracts and thus securities.  See, e.g., SEC v. Kik Interactive Inc., 492 F. Supp. 3d 

169, 173 (S.D.N.Y. 2020) (holding that certain crypto assets were sold as securities in 

unregistered transactions).  

22. In analyzing whether something is a security, “form should be disregarded for 

substance,” Tcherepnin v. Knight, 389 U.S. 332, 336 (1967), “and the emphasis should be on 

economic realities underlying a transaction, and not on the name appended thereto,” United 

Housing Found., Inc. v. Forman, 421 U.S. 837, 849 (1975). 

BACKGROUND ON CRYPTO ASSETS 

23. The term “crypto asset” generally refers to an asset issued and/or transferred using 

distributed ledger or blockchain technology, including assets sometimes referred to as 

“cryptocurrencies,” “digital assets,” “virtual currencies,” “digital coins,” and “digital tokens.” 

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24. A blockchain or distributed ledger is a peer-to-peer database spread across a 

network of computers that records all transactions in theoretically unchangeable, digitally 

recorded data packages.  The system relies on cryptographic techniques for secure recording of 

transactions. 

25. Blockchains typically employ a consensus mechanism to “validate” transactions, 

which, among other things, aims to achieve agreement on a data value or on the state of the 

ledger.  Crypto assets may be traded on crypto asset trading platforms in exchange for other 

crypto assets; they may also be also be purchased or sold from the platform in exchange for fiat 

currency (legal tender issued by a country). 

26. A blockchain “protocol” is a code, software, or algorithm that governs how a 

blockchain, or a feature of a blockchain, operates, including, among other things, the validation 

mechanism used for the particular blockchain. 

27. On July 25, 2017, the SEC issued the Report of Investigation Pursuant to Section 

21(a) of the Securities Exchange Act of 1934: The DAO, advising “those who would use . . . 

distributed ledger or blockchain-enabled means for capital raising[] to take appropriate steps to 

ensure compliance with the U.S. federal securities laws,” and finding that the offering of crypto 

assets at issue in that report involved investment contracts and thus securities. 

FACTS 

I. Sun and the Tron Foundation Launched TRX and Promoted It as an Investment  

A. Sun and the Tron Foundation Established the Tron “Ecosystem” 

28. No later than June 2017, Sun and the Tron Foundation began promoting the Tron 

“ecosystem”—i.e., a group of blockchain protocols, software code, and crypto assets controlled 

by Sun and the Tron Foundation—through a series of “whitepapers” that they posted on the 

internet.  The whitepapers often referred simply to “Tron” as a shorthand for the ecosystem that 

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Sun and the Tron Foundation controlled.  The whitepapers were aimed at the investing public, 

including investors in the United States.  At all relevant times, Sun and the Tron Foundation 

controlled and had ultimate authority over the statements made in the whitepapers. 

29. On or about August 22, 2017, Sun and the Tron Foundation posted Tron 

Whitepaper Version 1.7 (the “TRX Whitepaper”) on the internet.  The TRX Whitepaper 

explained that “TRON is a blockchain-based decentralized protocol that aims to construct a 

worldwide free content entertainment system with the blockchain and distributed storage 

technology.”  The TRX Whitepaper further explained that Tron’s protocol allowed users to 

publish, store, and own data, and to participate in “a decentralized content entertainment 

ecosystem.”   

30. Additionally, the TRX Whitepaper stated that the Tron Foundation was 

established “to operate [the] TRON network.”  

B. Sun and the Tron Foundation Marketed TRX as an Investment Before Its 
ICO 

31. Sun and the Tron Foundation used the TRX Whitepaper to, among other things, 

entice investors to purchase “TRX” (also known as “TRONIX”), a crypto asset that Sun and the 

Tron Foundation called the “Official Token of TRON.”  The TRX Whitepaper made clear that 

“[t]hose who wish to enter” the Tron ecosystem “must buy” TRX.  An investor would buy TRX 

with either fiat currency or another crypto asset. 

32. The TRX Whitepaper promoted an upcoming initial coin offering (“ICO”) of 

TRX, comprising 40 percent of the 100 billion total TRX supply.  The TRX Whitepaper 

explained that 35 percent of the remaining TRX would be allocated to the “TRON Foundation 

and the ecosystem,” 15 percent would be allocated to a “[p]rivate offering,” and 10 percent 

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would be allocated to “Peiwo Huanle (Beijing) Technology Co., Ltd.” (“Peiwo”), another 

Chinese company that Sun founded, owned, and controlled.  

33. The TRX Whitepaper described a “Realization Path” for the Tron ecosystem, 

which would take “8 to 10 years,” in which investors’ contributions would be used to further 

build out and enhance the Tron ecosystem.  The TRX Whitepaper indicated that investors’ 

fortunes were tied together, stating, “[a]ll TRON participants will benefit from its prosperity.” 

34. The TRX Whitepaper also promoted the profit potential for investors in TRX.  

For example, it stated: purchasers of TRX could “share [in] dividend growth”; Tron’s ecosystem 

was designed for TRX “holders who [are] optimistic about TRON on a long-term basis”; “those 

who hold and lock [TRX] for [the] long[-term] will be rewarded”; “[l]ong-term investment” was 

“critical;” “stakeholders enjoy . . . sustainable growth”; and “[l]ong-term holding of stakeholders 

[would] be the benchmark in the ecosystem and better lead the development of the ecology.”  

(Emphasis added.) 

35. The TRX Whitepaper additionally promoted the executive team whose efforts 

would lead to TRX’s success.  For example, the TRX Whitepaper listed Sun as the “Founder and 

Chief Executive Officer” and highlighted Sun’s prior experience working for another crypto 

asset company, stating that the “market value of [the company] has exceeded ten billion US 

dollars.”  Similarly, the TRX Whitepaper spotlighted other team members, emphasized their 

credentials, and stated that the “TRON founding team will spare no efforts to realize the 

development goal proposed in the white paper and expand the growth” of the Tron ecosystem.   

36. The TRX Whitepaper, and similar, later whitepapers promoting TRX that Sun and 

the Tron Foundation issued, remain on the internet and available to investors to this day. 

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37. From about August through September 2017, Sun and the Tron Foundation 

conducted the TRX ICO, offering and selling TRX to numerous purchasers who paid crypto 

assets—including bitcoin (“BTC”) and ether (“ETH”)—in exchange for TRX.  In the ICO, 40% 

of the total available supply of TRX was offered, sold, and otherwise distributed, with the 

remaining TRX allocated for distribution in the proportions listed in the TRX Whitepaper: 35% 

to the Tron Foundation and Tron ecosystem; 15% for distribution in a “private offering”; and 

10% to Peiwo.  Sun owned and/or controlled the Tron Foundation and Peiwo, and thus he 

effectively retained control over at least the 45% of TRX allocated to these entities. 

C. Sun and the Tron Foundation Sought to Create a Secondary Market for 
TRX While Continuing to Promote TRX as an Investment 

38. In early 2018, Bittrex was a crypto asset trading platform incorporated in 

Delaware, with its principal place of business in Seattle, Washington.  Bittrex was required to 

register with the SEC as an “exchange” under the Exchange Act, but it failed to do so.3 

39. On or about January 8, 2018, Sun sent an email (from his Tron email address) to 

Bittrex personnel, with the subject line “TRON Token Logistics,” and attached various 

documents for the purpose of getting TRX listed on Bittrex for trading.  The documents attached 

to Sun’s email included, among other things, a version of the TRX Whitepaper; a Business 

Profile for the Tron Foundation, which listed Sun as a Director; the Bittrex Token Application 

and Listing Agreement, which was between Bittrex and the Tron Foundation and was signed by 

Sun as the Tron Foundation’s “Founder & CEO”; and Exhibit B to the Bittrex Listing 

 
3  In April 2023, the SEC charged Bittrex with, among other things, operating as an unregistered national 
securities exchange in violation of the Exchange Act.  Bittrex settled the SEC’s charges, and in August 2023, a final 
judgment was entered against Bittrex.  See SEC Litigation Release No. 25817 (Aug. 29, 2023), available at 
https://www.sec.gov/litigation/litreleases/lr-25817. 

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Application, which stated that the “Applicant” was the Tron Foundation and that the “Ultimate 

Beneficial Owner” of the Tron Foundation was Sun.   

40. On or about March 1, 2018, Bittrex announced publicly on Twitter that TRX was 

“available for trading.”  Thereafter, Sun and the Tron Foundation publicly promoted each time 

TRX was “listed”—or made available for trading—on a new crypto asset trading platform, 

including the listing on a second U.S.-based platform on or about March 25, 2019.  From on or 

about March 1, 2018, through approximately July 2021, Sun and the Tron Foundation tweeted 

more than 200 times promoting the availability of TRX for trading on crypto asset trading 

platforms. 

41. Sun and the Tron Foundation also made other public statements promoting TRX 

as an investment.  For example, on or about March 17, 2018, Sun and the Tron Foundation 

posted on the U.S.-based digital publishing platform Medium a link to an article titled “4 

Reasons to Invest in Tron, Before the Main Net Launch.”  The article explained that ongoing 

efforts by Sun and the Tron Foundation “will boost the value of TRX” and stated that investors 

“should invest now, while [they] still can.”  The article further advised investors “considering 

investing in TRX” that “now is one of the best times to do it,” and that “[b]uying TRX now, 

while its [sic] cheap, could lead to serious returns after the Tron Main Net launches and investors 

rush to fill their bags.” 

42. Sun and the Tron Foundation specifically targeted investors in the United States.  

For example, on or about September 18, 2018, the Tron Foundation tweeted, “[y]ou can now buy 

$TRX directly with USD on @BittrexExchange.”  That tweet linked to a Global Coin Report 

post stating, “[T]his is the first time that Tron has been paired with the USD in the United 

States.”   

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43. That same day, Sun tweeted, “#TRX already can be traded on @BittrexExchange, 

$USD markets, $USD/ $TRX.  First #TRX fiat trading pair in US.  Go #TRON.  Go #TRONICS.  

#TRON to the future.”  

44. On or about December 15, 2019, Sun retweeted a post from another individual, 

which stated that investors in the United States could trade TRX “pretty much everywhere, 

especially with a VPN.”4  Sun’s retweet announced, “[w]e will make $TRX available for all 

[United States flag emoji] users!  More options are on the way!”  Sun and the Tron Foundation 

worked with crypto asset trading platforms to make TRX widely available for trading by 

investors in the United States, who could, at one point, trade TRX on at least four U.S.-based 

platforms. 

45. Sun and the Tron Foundation also regularly publicized their efforts to increase 

TRX’s value.  For instance, in an interview posted on November 30, 2017, to the Medium page 

of a popular investor in crypto assets, Sun promoted TRX’s availability for trading on four 

crypto asset trading platforms, and represented that his “team [was] working hard on getting on 

bigger exchanges.”   

46. In the same interview, Sun described a six-stage “roadmap” for future 

development, committing his team to a nearly eight-year development schedule.  Sun stated: 

“The roadmap is on the official website, there are six stages, Exodus, Odyssey, Great Voyage, 

Apollo Star, Trek, Eternity.  For now, we plan to make Peiwo APP compatible with TRX and 

complete the development of our own main chain.  After the own main chain is done, we will 

optimize the network based [sic] different kinds of online entertainments applications.” 

 
4  A VPN or virtual private network uses encryption over a public network, typically the internet, to create a 
secure, apparently private network.  Using a VPN allows a user to hide the public IP address of their device and, 
depending on the provider, may allow a user to select an “exit node” in a specific country or geographic region, 
hiding their actual location. 

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47. Sun and the Tron Foundation also widely publicized their efforts to manage the 

supply of TRX to ensure price appreciation for the benefit of TRX investors.  For example, on or 

about June 26, 2018, Sun tweeted that “#TRON completed Coin Burn of 1 billion #TRX,” with a 

link to a Tron Foundation Medium post explaining that “‘Coin burn’ refers to removing tokens 

from the total supply” and “helps to control inflation and reward[s] token holders” because 

reducing the total supply of TRX would typically increase the value of TRX remaining in the 

market.  

48. Likewise, on or about December 19, 2017, the Tron Foundation posted an 

“Announcement to Our Investors” (emphasis added) on its Medium page, stating that “[t]he 

34.2518% TRX held by Tron Foundation” was “locked up until January 1st, 2020,” and assuring 

investors that “Tron Foundation TRX will not be withdrawn or traded.”  The Tron Foundation 

concluded this post by stating, “[w]e are working hard in order to provide security and 

supervision of all our investors, supporters and believers.” 

49. Then, on or about June 26, 2019, the Tron Foundation posted to Medium an 

“Announcement on $20 Million TRX Buy-back Plan and 2020 TRX Holding Plan,” which 

detailed a plan to “conduct by far the largest TRX buy-back . . . with the widest coverage in the 

secondary market, which will last for a year and will be conducted in several batches with no less 

than $20 million.”  The stated purpose of this plan was “to promote community activity and 

market stability.”  The Medium post also assured investors that “[t]he [Tron] Foundation will 

continue to increase our TRX holdings in the secondary market to manifest our confidence in the 

development of the TRON ecosystem.”  

50. On or about June 27, 2019, Sun tweeted about the $20 million TRX buyback and 

included a link to an article on cointelegraph.com reiterating the details posted to Medium. 

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II. Sun and the Tron Foundation Engaged in Unregistered TRX Offers and Sales 

51. TRX was offered and sold as a security, specifically as an investment contract.  

All TRX purchasers, including those who tendered value for TRX other than cash or crypto 

assets, invested in a common enterprise alongside Sun and the Tron Foundation, who at all times 

retained significant TRX holdings.  Because the value of TRX rose or fell together for all 

holders, all TRX holders profited or suffered losses in amounts proportionate to their TRX 

holdings.  As such, their fortunes—including the realization of future profits—were inextricably 

tied to Sun’s fortunes and to each other’s.  And, given the widespread promotional statements by 

Sun and the Tron Foundation emphasizing the Tron Foundation’s TRX holdings, TRX 

purchasers reasonably expected their fortunes to be inextricably tied to those of Sun, the Tron 

Foundation, and each other. 

52. All TRX purchasers’ and holders’ prospective profits also depended largely on 

efforts by Sun and the Tron Foundation to develop the Tron protocol, make TRX available for 

trading on crypto asset trading platforms, and promote TRX to potential investors to increase its 

secondary market price for all holders.  And, given Sun and the Tron Foundation’s promotional 

statements, TRX purchasers and holders reasonably expected that the value of their investment 

would largely rise or fall on these efforts to increase TRX’s value.   

53. For offers and sales of TRX alleged herein that involved purchasers based in the 

United States, irrevocable liability was incurred and title transferred within the United States 

because the purchasers were located in the United States when they took the necessary actions to 

acquire TRX, including transmitting their purchase orders and payments for TRX.  

54. From at least March 2018 through February 2019, Sun and the Tron Foundation 

offered and sold TRX in three types of unregistered securities transactions described below. 

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55. No registration statement was ever filed with the SEC or in effect with respect to 

any of these offers and sales of TRX, and no exemption from registration was available for these 

offers and sales of TRX.  Thus, the offers and sales of TRX described below violated the 

registration provisions of the federal securities laws.       

A. Offers and Sales of TRX on a U.S.-Based Crypto Asset Trading Platform 

56. From on or about March 12, 2018, through February 11, 2019, Sun and the Tron 

Foundation offered and sold approximately 542.6 million TRX to investors, including investors 

in the United States who placed their orders on the U.S.-based crypto asset trading platform, 

Bittrex.  During this time, multiple investors located in this District—specifically, in New York 

City—purchased TRX through Bittrex.  In total, the unregistered sales of TRX, from 

approximately March 2018 through February 2019, generated net proceeds of more than $31.9 

million for Sun and the Tron Foundation.  

B. Offers and Sales of TRX in the Tron “Emoji Contest” 

57. Between August 13, 2018, and August 28, 2018, Sun and the Tron Foundation 

offered and sold 50,000 TRX through an online bounty program, pursuant to which Sun and the 

Tron Foundation transferred TRX to certain participants in exchange for completing specific 

tasks promoting TRX or the Tron Foundation.  They referred to this specific bounty program as 

an “emoji contest,” which required participants to “TELL A STORY ABOUT TRON WITH 

EMOJIS” by posting and sharing on Facebook and/or Twitter original compositions using 

“TRON elements” and emojis. 

58. According to an August 13, 2018, post by the Tron Foundation to its blog on 

Medium, creators of so-called “outstanding works,” specifically “the top 6 works with the most 

likes and shares on both Twitter and Facebook” would be rewarded with 31,000 TRX—16,000 

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TRX to the first-place winner, and 3,000 TRX each to five runners-up.  Another 5,000 TRX 

would be distributed to randomly selected participants who met the contest requirements but 

were not selected as winners based on the number of “likes and shares” received.  

59. Sun posted a link to the Medium announcement on his own Twitter feed, writing 

“#TRON EMOJI CONTEST: No text, no sound, creatively tell your story with the #TRON 

emoji, check out the details and earn $TRX #TRX.” 

60. To enter the “emoji contest,” participants had to upload their submissions to 

Twitter and/or Facebook with the hashtag #TRONFUN, and tag (or “@”) ten friends as well as 

@tronfoundation.  Friends tagged in the winning submissions would also receive TRX, with 

4,000 TRX to be shared equally by the ten friends of the first-place winner, and 100 TRX to be 

distributed to each of the ten friends tagged by the five runners-up.  

61. The announcement also stated that “[w]orks and pictures of the winners will be 

posted on TRON official website and official Twitter account.” 

62. By entering the “emoji contest,” participants provided Sun and the Tron 

Foundation with valuable consideration—the online promotion of the Tron ecosystem and TRX, 

promotional artwork to feature on the Tron website, and the Twitter and Facebook handles of 

entrants and their tagged friends—in exchange for an opportunity to receive TRX. 

63. In total, Sun and the Tron Foundation distributed 50,000 TRX to winners of the 

“emoji contest.”   

64. Neither Sun nor any of the Sun Defendants took any steps to exclude U.S. persons 

from receiving TRX in this offering, and at least one of the winners who received TRX was a 

resident of this District. 

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C. Offers and Sales of TRX in the “niTRON Sharing Campaign” 

65. Between December 12, 2018, and December 16, 2018, Sun and the Tron 

Foundation offered and sold 28,588 TRX through an online bounty program that required 

participants to retweet and comment on the Tron Foundation’s tweet announcing the contest and 

to include the hashtag “#niTRON.”   

66. According to the Tron Foundation’s tweeted announcement, three second prize 

winners—to be selected from among all contest entrants—would be awarded 6,666 TRX each, 

while five third prize winners would each receive 1,718 TRX.  Two first prize winners would 

receive tickets to attend the 2019 “niTron Summit,” a Tron-sponsored gathering at the Yerba 

Buena Art Center in San Francisco to discuss and promote the Tron ecosystem, TRX, and BTT.   

67. By entering the niTRON sharing contest, participants provided Sun and the Tron 

Foundation with valuable consideration—the promotion of the Tron Foundation and the niTRON 

summit on Twitter—in exchange for an opportunity to receive TRX.  

68. Neither Sun nor any of the Sun Defendants took any steps to exclude U.S. persons 

from receiving TRX in this offering, and at least one of the winners who received TRX was a 

U.S. person. 

III. The Sun Defendants Launched BTT and Promoted It as an Investment 

A. Sun Acquired Rainberry and Incorporated It into the Tron Ecosystem 

69. In or about June 2018, Sun purchased BitTorrent, Inc., a company based in San 

Francisco, California.  BitTorrent, Inc.’s technology allowed users to download and transfer 

digital data and files.  Sun changed the company’s name to Rainberry, although its promotional 

materials and Sun’s public statements often continued to refer to the company as BitTorrent.  

Sun then used Rainberry and the BitTorrent Foundation, which he formed in October 2018, to 

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offer and sell both TRX and the BitTorrent Token, a new crypto asset with the trading symbol 

“BTT.” 

70. In a “Letter to the Community” posted to the Tron Foundation’s Medium page on 

July 24, 2018, Sun announced “that TRON has successfully acquired BitTorrent and all 

BitTorrent products.  From this day on, BitTorrent … will become part of the TRON 

ecosystem….  Through this acquisition, BitTorrent and TRON will combine forces, with the 

TRON US team merging with the BitTorrent team….  Combining the robust capabilities of the 

two teams will take the technology behind the TRON ecosystem to a whole new level.”  

(Emphasis added). 

71. Around this time, Sun, the Tron Foundation, and the BitTorrent Foundation 

posted similar announcements to their respective Twitter accounts.  

72. Consistent with Sun’s July 24, 2018, announcement, Rainberry’s operations 

became intertwined with those of the Tron Foundation.  Rainberry employees and executives—

who had previously used email addresses with the “@BitTorrent” domain—were provided with 

“@tron.network” email addresses, and many Rainberry employees were tasked with working on 

projects related to the Tron Foundation.     

73. Sun and the Tron Foundation also began referring to key Rainberry personnel as 

“Tron” employees on social media.  Additionally, Rainberry personnel and Sun, on behalf of the 

Tron Foundation, the BitTorrent Foundation, and Rainberry, began appearing at events like the 

“niTron Summit,” discussed above and below, to publicize Tron and TRX alongside BitTorrent 

and BTT.  

74. From approximately November 11 to 14, 2018, Sun sent several emails to Bittrex 

personnel to discuss BTT and ask about “the listing process” for Bittrex to list BTT. 

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B. The Sun Defendants Promoted BTT as an Investment 

75. At all relevant times following his acquisition of BitTorrent, Inc., Sun had 

ultimate authority over the BitTorrent Foundation and Rainberry’s social media accounts—

including the @BitTorrent Twitter and Medium accounts—and he directed, controlled, and 

approved posts made on these accounts. 

76. On or about January 3, 2019, the BitTorrent Foundation and Rainberry 

announced, by tweet from the BitTorrent Foundation’s @BitTorrent Twitter account, the “new 

BitTorrent $BTT” crypto asset, which purportedly would be “exclusively available to non-U.S. 

accounts on #BinanceLaunchpad, the token sale platform [operated] by leading cryptocurrency 

exchange @binance!” 

77. In early January 2019, Sun traveled to Rainberry’s office in San Francisco, 

California.  While in the San Francisco office, Sun and Rainberry’s Head of Product and 

Engineering, who worked in the San Francisco office, broadcasted a livestream on the Internet to 

promote the Tron ecosystem, TRX, and BTT.  In the livestream, Sun and the Head of Product 

and Engineering appeared on camera, together, wearing sweatshirts featuring the BitTorrent 

name and logo and displaying water bottles with the Tron logo.  During the livestream, Sun 

explained that BTT would benefit TRX holders because “the current Tron community” would be 

allocated with BTT, meaning that TRX holders would be “entitled” to receive “the BTT 

airdrop.”  Sun stated that, because of the relationship between TRX and BTT, “the TRX 

community [was] tied with the BTT community.”  Additionally, Sun stated that BTT would use 

the “Tron network,” so BTT would attract numerous BitTorrent users and grow the Tron 

ecosystem.  Sun also asserted that people who were interested in BTT were “definitely welcome 

to join the Binance Launchpad to start to invest in the BTT token,” provided they completed the 

“KYC [know your customer] process.”  The Head of Product explained, as Sun nodded along, 

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that BTT was created in part “to address this giant potential market without having to give all 

those people TRX, in order to protect the existing TRX holders without diluting [TRX’s value] 

by giving out lots of TRX.”  Sun also stated that the upcoming airdrops of BTT would be “all in 

the Tron Foundation.”   

78. On January 17 and 18, 2019, Sun again was present in San Francisco for the 

niTron Summit, a two-day event before a live audience to promote the Tron ecosystem, TRX, 

and BTT.  At the Summit, Sun appeared on stage wearing a shirt with the Tron logo displayed on 

the front and a sweatshirt with the name BitTorrent on the back.  Speaking to the audience, Sun 

showed a video highlighting the “market cap history” of TRX and illustrating its rising market 

capitalization “in Millions USD” among the “Top 100 Cryptos by Market Cap.”  Sun told the 

audience that, “today, I think we are number 9” in market capitalization, and in 2019, TRX was 

“aiming to become at least number 4.”  Sun stated that TRX was “climbing the ladder of the 

most valuable crypto currency.”  Discussing his plans for 2019, Sun indicated that he expected 

TRX’s transaction volume to grow and that more exchanges would list TRX for trading.  

Additionally, Sun promoted the upcoming “public sale” of BTT and the “airdrops” of BTT to 

“TRX holders.”  Sun added that BTT would use the Tron “infrastructure” and thus “promote the 

integration and synergy between the [sic] Tron and BitTorrent” in the Tron ecosystem. 

79. The Sun Defendants scheduled the first offer and sale of BTT for late January 

2019.  Around that time, the Sun Defendants posted to BitTorrent’s website a new whitepaper 

(the “BTT Whitepaper”) to promote BTT to investors.  Sun controlled and had ultimate authority 

over the statements made in the BTT Whitepaper. 

80. The BTT Whitepaper stated that “[i]n 2018, BitTorrent formed a strategic 

partnership with TRON,” and that the “TRON Foundation and BitTorrent Foundation are 

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introducing a new cryptographic token, called BTT.”  The BTT Whitepaper further explained 

that BTT would be “made available as a divisible token, allowing for granular pricing.” 

81. The BTT Whitepaper also promoted the initial offering of BTT.  It explained that 

990 billion BTT would be offered and sold, and that the tokens would be distributed as follows:  

6% for public sale; 2% for private sale; 9% for “[s]eed sale”; 10.1% for “Tron airdrop tokens”; 

10% for “BitTorrent protocol airdrop tokens”; 19% for the “BitTorrent Team and the BitTorrent 

Foundation”; 20% for the Tron Foundation; 19.9% for the “BitTorrent ecosystem”’ and 4% for 

“[p]artnership tokens.”   

82. On or about January 29, 2019, the Sun Defendants publicly offered or caused to 

be offered BTT for the first time through a so-called initial exchange offering (“IEO”). 

83. Like ICOs, IEOs are offerings of crypto assets to raise capital.  However, IEOs 

are conducted by crypto asset trading platforms on behalf of crypto asset issuers—usually for a 

fee—and immediately provide a secondary market for crypto asset purchasers.   

84. Only holders of TRX or another specifically-identified crypto asset were eligible 

to purchase BTT in the IEO, and all BTT tokens offered in the IEO were sold in less than fifteen 

minutes. 

85. Soon after the IEO, on or about January 28, 2019, Sun tweeted:  “For those [who] 

didn’t get #BTT in the public sale, stay tuned for the #TRX airdrop!  Own[ing] $TRX will secure 

your chance to get $BTT! #TRON #BitTorrent.”  

86. As with TRX, the BTT Whitepaper, and similar, later whitepapers promoting 

BTT, remained on the internet and available to investors from February 2019 through the 

present.  

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C. The Sun Defendants Sought to Create a Secondary Market for BTT Trading 
While Continuing to Promote It as an Investment 

87. After the BTT IEO, the Sun Defendants, acting through the BitTorrent 

Foundation, applied for and secured listings for BTT on various crypto asset trading platforms, 

including Bittrex.   

88. Social media posts by each of the Sun Defendants created a reasonable 

expectation of profit for BTT investors.  For instance, immediately following the BTT IEO, on 

January 31, 2019, Sun tweeted that he had “[t]ak[en] the humble approach and ke[pt] the initial 

sale price low” to “benefit the community and reward them with decent return!”  The Sun 

Defendants also promoted opportunities to profit from “staking” BTT on various platforms, 

including more than 40 tweets from January 2020 through May 2021, further promoting BTT as 

an investment.5 

89. Later, around March 1, 2019, in a chat broadcast on Telegram,6 Sun stated that he 

chose to offer and sell the new BTT tokens, rather than more TRX, to avoid “diluting the value 

of TRX.”  Sun also emphasized that his goal was to “increase[e] the value of TRX and BTT.” 

90. Sun’s social media posts and public statements also highlighted increases in 

BTT’s price and trading volume, thus promoting BTT trading.  For example, on May 6, 2019, 

after TRX fell from a list of “top 10 cryptocurrencies,” Sun stoked continued interest in TRX and 

BTT on Twitter, tweeting: “#TRON will be back to Top 10 in June!  #BitTorrent will be Top 30 

 
5  “Staking” concerns the “proof of stake” validation protocols that certain blockchains utilize.  These 
protocols offer rewards to those who “validate”—or confirm—transactions on the blockchain.  To become a 
validator and obtain such rewards, holders of crypto assets must first “stake”—or commit—crypto assets (typically, 
the “native” crypto asset on a particular blockchain).  Validators are selected based on the size of their stake, among 
other factors, creating an incentive to stake, or commit, greater quantities of crypto assets.  The protocols incentivize 
validators to add legitimate transactions to the blockchain because validators are rewarded if they do and could be 
penalized if they do not, including by having the staked crypto assets “slashed” (or destroyed). 

6  Telegram is a cross-platform messaging application commonly used by crypto asset issuers and promoters 
to disseminate information about crypto asset offers and sales to interested parties and potential investors. 

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in Q2.”  On May 29, 2019, Sun tweeted: “Mission completed.  It is just a beginning.  More to 

come,” with a link to a post announcing that TRX had returned to the top 10 and BTT had 

entered the top 30 cryptocurrencies. 

91. The Sun Defendants announced other perceived milestones for BTT trading in the 

secondary market.  For example, in May 2019, Sun tweeted: “$BTT hit the 2nd place with the 

highest price increase over the last 24 hours among the TOP100 #Cryptos by Market 

Capitalization!”  Similarly, in February 2021, @BitTorrent tweeted that “$BTT Price Hits New 

High.  $BTT grew + 151% in 24 hours, +232% in 7 days.  #BTT to the [sic] Mars,” with two 

rocket emojis.   

92. The @BitTorrent Twitter account also promoted BTT’s “ROI” or “return on 

investment” on social media, for example by retweeting a post on July 2, 2019, comparing 

BTT’s “current ROI” of “11.16x” to lower ROIs of other tokens also offered through IEOs.  

Later, on July 19, 2021, Rainberry promoted BTT’s secondary market performance, highlighting 

that “[a]ccording to CryptoRank Platform, #BitTorrent is Top 3 gainer with 751% profits in 

2021.” 

93. In addition to promoting the BTT secondary market, the Sun Defendants also 

worked to make BTT available for trading on numerous crypto asset trading platforms.  Sun, or 

others acting at his direction, submitted listing applications to multiple crypto asset trading 

platforms, including Bittrex, showing the BitTorrent Foundation as the applicant.   

94. The Sun Defendants’ efforts to promote and grow a robust secondary market for 

trading in BTT were successful.  According to a December 20, 2019, tweet by @BitTorrent, as 

of that date at least 39 crypto asset trading platforms had made BTT available for trading. 

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95. The availability of BTT on numerous trading platforms allowed investors in the 

U.S. to purchase and sell BTT, which they did.  On January 5, 2019, Sun posted a livestream to 

YouTube in which he encouraged U.S. investors to “use the bitcoin . . . or any cryptocurrency to 

buy the BTT in the future,” despite apparent restrictions on U.S. investors’ participation in the 

BTT IEO.  On May 11, 2021, the @BitTorrent Twitter account posted a link to a video by “Mike 

Tha Investor” with information “for those who doesn’t [sic] know how to buy #BTT in the U.S.” 

IV. The Sun Defendants Engaged in Unregistered BTT Offers and Sales 

96. BTT was offered and sold as a security, specifically as an investment contract.  

All BTT purchasers, including those who tendered value for BTT other than cash or crypto 

assets, invested in a common enterprise alongside the Sun Defendants, who at all times retained 

significant BTT holdings.  Because the value of BTT rose or fell together for all holders, all BTT 

holders profited or suffered losses in amounts proportionate to their BTT holdings.  As such, 

their fortunes—including the realization of future profits—were inextricably tied to those of the 

Sun Defendants and each other’s.   

97. BTT purchasers’ and holders’ prospective profits also depended largely on the 

efforts of the Sun Defendants to develop the BitTorrent protocol, grow public interest in BTT 

and TRX, make BTT available for trading on crypto asset trading platforms, and promote BTT to 

potential investors to increase its secondary market price for all holders.  And, given the Sun 

Defendants’ promotional statements, BTT purchasers and holders reasonably expected that the 

value of their investment would largely rise or fall on these efforts to increase BTT’s value.   

98. For offers and sales of BTT alleged herein that involved purchasers based in the 

United States, irrevocable liability was incurred and title transferred within the United States 

because the purchasers were located in the United States when they took the necessary actions to 

acquire BTT, including transmitting their purchase orders and payments for TRX (which was 

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necessary to receive airdrops of BTT) or performing the various promotional activities described 

below (which were necessary to receive other distributions of BTT). 

99. From at least February 2019 through October 2021, the Sun Defendants offered 

and sold BTT in the nine types of unregistered securities transactions described below. 

100. No registration statement was ever filed with the SEC or in effect with respect to, 

and no exemption from registration was available for, any of these offers and sales of BTT.  

Thus, the offers and sales of BTT set forth below violated the registration provisions of the 

federal securities laws. 

A. Offers and Sales of BTT in Monthly “Airdrops” 

101. From on or about February 11, 2019, through June 13, 2020, the Sun Defendants 

offered and sold BTT through monthly so-called “airdrops” to TRX holders. 

102. In the crypto asset space, an airdrop typically refers to the distribution of crypto 

assets to certain recipients, purportedly without requiring them to pay cash consideration for the 

asset.  With respect to BTT, however, the recipients had to purchase and hold TRX to be eligible 

for airdrops of BTT.  Indeed, anyone who purchased and held TRX in a Tron digital wallet or on 

a participating crypto asset trading platform received BTT regardless of their geographic location 

or country of citizenship.  

103. On January 4, 2019, before the BTT IEO, Sun and the Tron Foundation both 

promoted the BTT monthly airdrop program to their followers, tweeting, “Keep decentralizing 

the web, tokenizing the world’s largest decentralized file sharing protocol.  Wanna know more 

about #BTT @BitTorrent, #BinanceLaunchpad, #niTROnSummit & #BTT airdrop plan?  See 

you there at 8:00am, Jan 5th, 2019(PST) (4 hours later).  #TRON to the future.  #TRX.” 

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104. On January 20, 2019, the BitTorrent Foundation “unveil[ed] more details 

regarding BitTorrent (BTT) airdrops for TRON (TRX) holders” in a post to the @BitTorrent 

Medium page.  Sun and the Tron Foundation each tweeted a link to the January 20, 2019, 

Medium post, simultaneously announcing the plan to “initiate [the] first airdrop of BitTorrent 

$BTT to the TRON $TRX holders on February 11th, 2019.” 

105. The January 20, 2019, Medium post announced, “On February 11th, 2019, 

BitTorrent Foundation will initiate its first airdrop of BitTorrent (BTT) to TRON (TRX) holders.  

The snapshot”—a complete record of TRX ownership as of a specific point in time prior to the 

airdrop used to identify qualifying airdrop recipients—“will be taken when TRON’s block height 

reaches 6.6 million*.  Based on this snapshot, BitTorrent Foundation will initiate its first airdrop 

of 10,890,000,000 BitTorrent (BTT), corresponding to 1.1% of total supply.” 

106. The January 20, 2019, Medium post further announced, “Over the next 12 months 

following this initial airdrop, 11,880,000,000 BTT will be offered to TRX holders, 

corresponding to 1.2% of total supply.  In 2020, the BitTorrent Foundation will airdrop 

12,870,000,000 BTT, corresponding to 1.3% of the total supply, and over the next six years, the 

percentage airdropped will increase by 0.1% per year, reaching 1.7% in 2025.” 

107. To receive BTT in these airdrops, recipients had to hold TRX tokens in “official 

wallets relaying on TRON’s network,” or in accounts on crypto asset trading platforms 

“supporting the airdrops.”  As explained in the January 20, 2019, Medium post, “If you are 

holding TRX, you will be eligible for BTT airdrops.  All official wallets relaying on TRON’s 

network and carrying TRX will be eligible for BTT airdrops corresponding to the amount they 

are holding.  No minimum of TRX is required to qualify for BTT airdrops.” 

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108. On February 11, 2019, @BitTorrent posted an update to its Medium page 

announcing that the “BitTorrent (BTT) Airdrop program for TRON (TRX) holders [has been] 

initiated.”  According to this post, “all the addresses running on TRON’s blockchain that have a 

TRX balance greater than or equal to 1 TRX” and all investors with “TRX stored on an exchange 

or a wallet supporting the official airdrop program” would receive 0.1097681177 BTT for each 

TRX held. 

109. Following the first monthly BTT airdrops to TRX holders on February 11, 2019, 

from March 2019 through February 2020, the Sun Defendants airdropped an additional 

990,000,000 additional BTT to TRX holders on or about the 11th day of each month.   

110. Two subsequent monthly airdrops of 1,072,500,000 BTT took place on April 11 

and May 11, 2020, before the @BitTorrent Medium page announced on June 13, 2020, the end 

of the airdrop program: “Today, after 16 rounds of BTT airdrops, BitTorrent Speed enjoys over 

12 million monthly active users.  After discussions among the BitTorrent Foundation, 

community developers, and community representatives, it is the community’s belief that the 

monthly BTT airdrop to TRX holders has achieved its goals, and will discontinue with 

immediate effect.”  

111. According to the June 13, 2020, post to @BitTorrent’s Medium page, “[t]hrough 

May 11, 2020, BTT [] completed 16 rounds of airdrops to TRX holders, airdropping a total of 

25,987,500,000 BTT out of the total pool of 99,990,000,000 BTT, allowing millions of TRX 

holders to use BTT within the BitTorrent ecosystem.”  

112. Anyone who purchased and held TRX in an “official” wallet at the time of each 

monthly “snapshot” received BTT regardless of their geographic location or country of 

citizenship.  Persons in the United States were not excluded from receiving BTT through the 

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monthly airdrop program, and in fact the Sun Defendants sent BTT to persons in the United 

States via airdrops.  

113. In addition to the monthly airdrop program, the January 20, 2019, post to 

BitTorrent’s Medium page announced “plans to airdrop additional 99,990,000,000 BTT, during 

online and offline events, corresponding to 10% of the total supply.”  Sun, the BitTorrent 

Foundation, and Rainberry ultimately offered and sold some of these additional BTT through 

various bounty programs, as detailed below. 

114. On February 27, 2019, in an “Ask Me Anything” (or “AMA”) session held on the 

English language Telegram channel of a crypto asset trading platform, Sun explained the purpose 

of the monthly BTT airdrop to TRX holders: “This is a program to give our users early access to 

our product, and to encourage them to stick with us for the long term.  We are not only 

airdropping to TRX holders, but also giving the BTT token to BitTorrent users through the 

clients.  We expect over 100M active users will get to know about cryptocurrency and the first 

one they will experience will be BTT.”  

115. Sun emphasized the airdrop program’s potential to bring BitTorrent’s 100 million 

users into the crypto asset community, stating: “We will provide BTT as an early access 

mechanism to the 100 million active users and most of them are not cryptocurrency users.  

However, the 100 million users are the targeted users, and they share a lot of similarities with 

crypto users.  Firstly, they are interested in decentralized technologies and are using peer-to-peer 

technology.  Secondly, the majority of BitTorrent users are males between 25 and 35 years old, 

which is also a group very interested in cryptocurrency.  Therefore, when the 100 million users 

receive BTT airdrops, they will start to wonder what BTT is, and what cryptocurrency is, and 

start to investigate.” 

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116. Sun also explained that the decision to target BitTorrent’s users with a new token, 

BTT, instead of TRX, was intended to avoid “diluting” TRX’s value for existing holders.  “The 

BitTorrent user base is huge (~100M MAU), so we can’t provide enough TRX to then bootstrap 

the economy without diluting the value of TRX,” said Sun in his February 27, 2019, AMA.  Sun 

added: “Since BTT is a TRC-10 token, TRX and BTT are like a razor and a blade.  It’s really 

important for me to give access to BTT to the TRON community and reward the TRX holders so 

we decided to create a 6 years long program to airdrop 10% of the total circulating supply which 

is pretty unique within the crypto space.  The more successful BTT is, the more successful TRX 

will be.” (Emphasis added.) 

117. By acquiring and holding TRX tokens in exchange for the opportunity to receive 

BTT through monthly airdrops, would-be BTT airdrop recipients provided the Sun Defendants 

with valuable consideration—(i) increased demand for TRX, (ii) further growth in TRX trading 

volume and liquidity on the secondary market, (iii) upward pressure on TRX’s secondary market 

price, (iv) promotion of BTT and the BitTorrent platform to TRX’s existing base of engaged 

crypto asset investors, and (v) the rapid development of a secondary market for BTT.   

B. Offers and Sales of BTT in the “New Year 2020” Distribution 

118. From on or about December 23, 2019, through January 1, 2020, the Sun 

Defendants offered and sold BTT through an online bounty program they referred to as the “New 

Year 2020” distribution. 

119. To receive BTT in this distribution, participants had to follow BitTorrent on 

Twitter, visit BitTorrent’s page on YouTube, submit online an answer to the question “why do 

you use Bit Torrent?” and tag friends’ social media accounts—all forms of publicizing Rainberry 

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and BTT.  To receive BTT in this distribution, participants also had to have or establish a BTT 

wallet address. 

120. The Sun Defendants announced this distribution in a December 22, 2019, post to 

the @BitTorrent Medium page: “[t]o celebrate the coming of exciting 2020 year, BitTorrent 

decides to give away 7 million BTT to BitTorrent community, including a special big prize for 

this Christmas.  Each day during the event, 10 winners will be drawn from the selected entries, 

starting on December 23[rd].  Because the drawing is done randomly and each user is allowed 

multiple entries (see “rules” below), you could win multiple days, or even multiple times each 

day!” 

121. According to this Medium post, 10 winners chosen daily between December 23, 

2019, and January 1, 2020, would each receive 50,000 BTT, with the exception of 10 winners 

chosen on December 25, 2019, who would receive “a special big prize for this Christmas” of 

250,000 BTT each. 

122. On December 23, 2019, @BitTorrent also announced the distribution on Twitter, 

with a link to the December 22, 2019, Medium post, as well as a link to a website hosted by a 

third party that describes itself as “The Business Growth Platform,” where participants could 

submit contest entries.  According to the entry submission page, 40,484 complete entries were 

received. 

123. By completing the steps required to enter, participants provided the Sun 

Defendants with valuable consideration, including advertising and publicity for Rainberry and 

BTT, as well as social media handles for entrants and the friends they tagged.  In addition, 

participants who had not yet established BitTorrent accounts and corresponding wallets had to do 

so, increasing the apparent number of active BitTorrent users and BTT wallet holders.  

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124. None of the Sun Defendants took any steps to exclude U.S. persons from 

receiving BTT in this offering. 

C. Offers and Sales of BTT in the BitTorrent “Discord Giveaway” 

125. From on or about March 3, 2021, through March 15, 2021, the Sun Defendants 

offered and sold BTT through a bounty program they referred to as a “Discord Giveaway.” 

126. On or about March 3, 2021, @BitTorrent announced this distribution on Twitter: 

“#BitTorrent Discord is now officially launched!  With the launch of our Discord, we prepared 1 

Billion $BTT for winners who completed our requests, join here,” with a link to a third party 

website where participants could submit contest entries. 

127. To receive BTT in this contest, participants had to join the BitTorrent Discord 

channel,7 submit entry information on a third-party platform, and engage with BitTorrent’s social 

media platforms to earn “points” by following and retweeting posts by BitTorrent on Twitter and 

referring friends by providing their social media contact information.  

128. According to the entry submission page, 2,691,181 complete entries were 

received.  The total distribution of 1,000,000,000 BTT was shared among 300 winners randomly 

selected from among all entrants, with the top 10 winners sharing 300,000,000 BTT and the 

remaining 290 winners sharing 700,000,000 BTT. 

129. By completing the steps required to enter, participants provided the Sun 

Defendants with valuable consideration, including (i) growing BitTorrent’s Discord channel, (ii) 

promoting BTT and the BitTorrent platform on social media, (iii) increasing apparent 

 
7  Discord is a U.S.-based online platform that describes itself as “a voice, video, and text chat app that’s used 
by tens of millions of people . . . to talk and hang out with their communities and friends.”  Discord is commonly 
used by crypto asset issuers and promoters to disseminate information about crypto asset offers and sales to 
interested parties and potential investors. 

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engagement with BitTorrent’s social media platforms, and (iv) providing their identifying 

information and that of their referred friends for future use by the Sun Defendants. 

130. None of the Sun Defendants took any steps to exclude U.S. persons from 

receiving BTT in this offering. 

D. Offers and Sales of BTT in “1 Million BTT Giveaway” 

131. From on or about March 30, 2021, through April 2, 2021, the Sun Defendants 

offered and sold additional BTT through a bounty program they referred to as the “1 Million 

BTT Giveaway.” 

132. On March 29, 2021, @BitTorrent announced the 1 Million BTT distribution on 

Twitter: “1,000,000 $BTT Giveaway BitTorrent is launching a series of campaigns to giveaway 

1M $BTT to reward #BTT community for supporting us throughout.💕. ✅Follow, Like, RT  

✅Tag 3 friends 💙30 lucky winners get 2500 $BTT each.”  

133. To become eligible to receive BTT in this distribution, participants had to follow 

the @BitTorrent Twitter feed, like or retweet certain BTT-related announcements, and tag three 

friends.  Thirty winners randomly selected from among all entrants were each awarded 2,500 

BTT. 

134. By completing the steps required to enter, participants provided the Sun 

Defendants with valuable consideration, including (i) promoting BTT and the BitTorrent 

platform on social media and to their tagged friends, (ii) increasing apparent engagement with 

BitTorrent’s social media platforms, and (iii) providing their social media contact information 

and that of their friends for future use by the Sun Defendants. 

135. None of the Sun Defendants took any steps to exclude U.S. persons from 

receiving BTT in this offering. 

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E. Offers and Sales of BTT in the “Design Contest” 

136. From on or about March 31, 2021, through April 7, 2021, the Sun Defendants 

offered and sold BTT through a bounty program they referred to as a “design contest.” 

137. On March 31, 2021, @BitTorrent announced the “design contest” on Twitter, 

directing participants to “Free your mind at #BitTorrent Design Contest and win 100,000 $BTT!  

✅Create #memes, videos or pics for BitTorrent, #BTT or @justinsuntron   ✅RT + Reply with 

your artwork  ✅Top 10 with the most likes will get 10,000 $BTT each.” 

138. To receive BTT in this contest, participants had to retweet the contest 

announcement along with original content in the form of a meme, video, or picture, tweet 

promoting and tagging BitTorrent, BTT, or Sun.  Ten entrants whose tweets received the most 

“likes” were awarded 10,000 BTT each. 

139. By completing the steps required to enter, participants provided the Sun 

Defendants with valuable consideration, including (i) original promotional artwork, (ii) the 

promotion of BTT and the BitTorrent platform on social media, and (iii) increased apparent 

engagement with BitTorrent’s Twitter account. 

140. None of the Sun Defendants took any steps to exclude U.S. persons from 

receiving BTT in this offering.   

F. Offers and Sales of BTT in the “April Carnival” 

141. From on or about April 6, 2021, through April 20, 2021, the Sun Defendants 

offered and sold BTT through a bounty program they referred to as the “April Carnival.”   

142. On April 6, 2021, @BitTorrent announced the “BitTorrent April Carnival” on 

Medium: “BitTorrent is celebrating BitTorrent April Carnival and launching a 50,000 BTT 

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Telegram Giveaway in the following two weeks!  Come and win a prize by joining BitTorrent 

Telegram and completing the tasks given by the BitTorrent bot!” 

143. To be eligible to receive BTT in this contest, participants had to follow 

@BitTorrent’s Twitter account and join the BitTorrent Telegram channel, where they then had to 

chat with a “bot” to obtain a unique “referral link.”  Participants then had to invite friends to join 

the BitTorrent Telegram channel by sharing the referral link.  

144. According to the Medium announcement, all entrants who joined the BitTorrent 

Telegram channel would share 15,000 BTT, while the first 300 users to complete all required 

tasks would share another 15,000 BTT.  An additional 35,000 BTT were shared by the 100 

entrants who invited the most new users who then joined the campaign. 

145. By completing the steps required to enter, participants provided the Sun 

Defendants with valuable consideration, including (i) promoting BTT and the BitTorrent 

platform on social media, (ii) growing BitTorrent’s Telegram channel, (iii) increasing apparent 

engagement with BitTorrent’s social media platforms, and (iv) providing their social media 

contact information and that of their friends for future use by the Sun Defendants. 

146. None of the Sun Defendants took any steps to exclude U.S. persons from 

receiving BTT in this offering.  

G. Offers and Sales of BTT in Sun’s AMA Distribution 

147. From on or about May 25, 2021 through June 2, 2021, the Sun Defendants offered 

and sold BTT through a bounty program connected to a May 28, 2021 AMA session on 

BitTorrent’s Telegram channel, featuring the COO of an Indonesia-based crypto asset trading 

platform.   

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148. As @BitTorrent announced in a May 25, 2021, tweet, individuals could become 

eligible to receive BTT in this distribution by participating in the AMA session and submitting 

questions in the comments section to be answered during the session.  The Sun Defendants 

distributed an unknown number of BTT tokens to the eight contest winners selected randomly 

from among all entrants. 

149. By completing the steps required to enter, participants provided the Sun 

Defendants with valuable consideration, including growing BitTorrent’s Telegram channel, and 

increasing apparent engagement with BitTorrent’s social media platforms. 

150. None of the Sun Defendants took any steps to exclude U.S. persons from 

receiving BTT in this offering. 

H. Offers and Sales of BTT in the 800 Million BitTorrent Discord “Giveaway” 

151. From on or about June 9, 2021, through June 11, 2021, the Sun Defendants 

offered and sold BTT through a bounty program they referred to as a Discord “giveaway.” 

152. On June 9, 2022, @BitTorrent announced the 800,000,000 BTT Giveaway on 

Twitter: “800 Million $BTT Giveaway is now live on #BitTorrent Discord!  🎁We are hosting a 

special giveaway with a huge prize pool.  To be eligible, Please join our Discord via gleam for 

full information!.”  

153. To receive BTT in this contest, participants had to join the BitTorrent Discord 

channel, submit entry information on a third-party platform, and engage with BitTorrent’s social 

media platforms to earn “points” by following and retweeting posts by BitTorrent on Twitter, 

and referring friends by providing their social media contact information.  

154. According to the entry submission page, 1,510 completed entries were received.  

A distribution of 650,000,000 BTT was shared among all entrants, with 150 winners selected 

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from among all entrants to share another 150,000,000 BTT.  

155. By completing the steps required to enter, participants provided the Sun 

Defendants with valuable consideration, including (i) growing BitTorrent’s Discord channel, (ii) 

promoting BTT and the BitTorrent platform on social media, (iii) increasing apparent 

engagement with BitTorrent’s social media platforms, and (iv) providing their identifying 

information and that of their referred friends for future use the Sun Defendants. 

156. None of the Sun Defendants took any steps to exclude U.S. persons from 

receiving BTT in this offering. 

I. Offers and Sales of BTT in the “Golden Wallet Sweepstakes” 

157. From on or about September 7, 2021, through October 11, 2021, the Sun 

Defendants offered and sold BTT through a bounty program they referred to as the “Golden 

Wallet Sweepstakes.” 

158. In a September 7, 2021, post on Medium, @BitTorrent announced the Golden 

Wallet Sweepstakes, in which “four lucky winners will receive 1M BTT, and one grand prize 

winner will receive 10M BTT.” 

159. To become eligible to receive BTT in this distribution, participants had to “enter 

by downloading the free or Pro version of any BitTorrent or µTorrent client that contains a 

BitTorrent Speed wallet, then activat[e] the Golden Wallet Sweepstakes following the steps 

outlined when launching BitTorrent Speed for the first time.” 

160. By completing the steps required to enter, each participant provided the Sun 

Defendants with valuable consideration by becoming a new BitTorrent client user and growing 

BitTorrent’s active user base. 

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161. None of the Sun Defendants took any steps to exclude U.S. persons from 

receiving BTT in this offering. 

V. The Sun Defendants Engaged in Manipulative Trading of TRX 

162. From approximately February 2018 through February 2019, Sun led a team of at 

least three Tron Foundation employees and two Rainberry employees in a scheme to artificially 

inflate the trading volume of TRX through wash trading between accounts controlled by the 

BitTorrent Foundation, Tron and Rainberry employees, and ultimately Sun.  Sun, and those who 

helped him carry out this scheme, acted intentionally or recklessly at all relevant times.   

163. Wash trading generally refers to “trades that occur without a change in beneficial 

ownership.”  SEC v. Williky, 942 F.3d 389, 391 (7th Cir. 2019).  Wash trading is fraudulent 

because it creates a “false perception of market activity that does not reflect the true supply and 

demand for the securities.”  Id.   

164. Sun’s team conducted the wash trading of TRX on at least Bittrex, which was 

based in the United States.  At all relevant times, Sun directed and was aware of his team’s wash 

trading.   

165. As described herein, the wash-trading scheme involved significant conduct within 

the United States.  In addition, to the extent that Sun, or the Tron Foundation or Rainberry 

employees acting at his direction, were physically located outside the United States when they 

conducted any part of the wash-trading scheme, their actions had a foreseeable and substantial 

effect within the United States because, among other things, the wash trading took place on 

Bittrex trading platform, which was based in the United States.  Moreover, because Sun, the 

Tron Foundation, and Rainberry had created a market for TRX in the United States through their 

promotions and sales of TRX to United States investors, their manipulative wash trading of TRX 

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had a direct and foreseeable effect on the United States market for TRX, including on the 

investors in the United States who had purchased TRX. 

166. Through this wash-trading scheme, Sun and his team intentionally or recklessly 

created the false and misleading appearance of legitimate, active TRX trading.  By this scheme, 

Sun and his team engaged in a series of transactions that created actual, active trading for the 

purposes of inducing the purchase or sale of TRX by others and making it easier for Sun and the 

Tron Foundation to sell TRX while keeping its price stable.  The scheme also involved other 

deceptive conduct, which was carried out intentionally or recklessly, as set forth below. 

A. Sun’s Team Opened Nominee Accounts on Bittrex to Manipulate the Market 
for TRX 

167. Between about February 23 and March 27, 2018, Sun directed Tron Foundation 

employees to open nominee accounts on multiple crypto asset trading platforms, including 

Bittrex.  As described below, Sun’s team opened four accounts on Bittrex that were used to wash 

trade. 

168. On or about March 27, 2018, Sun’s team opened two accounts on Bittrex in the 

names of Chinese nationals, one of whom was Sun’s father.  Those accounts were labeled 

“Account 16” and “Account 17.”   

169. On or about April 6, 2018, the Tron Foundation electronically transmitted to 

Bittrex an “Authorized Trader Letter,” which stated that several accounts, including Account 16 

and Account 17, were “authorized by SUN YUCHEN [Justin Sun],” the “Founder and CEO of 

Tron Foundation.”  (Bracketed text added.)  The Authorized Trader Letter was signed by Sun 

and dated April 6, 2018. 

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170. On or about August 26, 2018, Sun’s team opened a third account Bittrex in the 

name of a U.S.-based Rainberry employee (“U.S. Nominee One”).  That account was labeled the 

“Activity Account.” 

171. On or about September 17, 2018, Sun, U.S. Nominee One, and Rainberry’s Chief 

Financial Officer (“CFO”), among others, attended a “global executive meeting.”  During that 

meeting, and as part of the wash-trading scheme, Sun approved a wire transfer of $10,000 into 

U.S. Nominee One’s personal account.  In approving the transfer, Sun knew or was reckless in 

not knowing that the $10,000 would subsequently be passed from U.S. Nominee One’s personal 

account to the Activity Account and used for wash trading. 

172. The next day, September 18, 2018, Rainberry’s CFO also approved the $10,000 

wire transfer and instructed his Rainberry staff to make the transfer to U.S. Nominee One.  

Rainberry staff complied, making payment from a U.S.-based bank account in Rainberry’s name.   

173. On or about September 20, 2018, Sun’s team opened a fourth account on Bittrex 

in the name of another U.S.-based Rainberry employee (“U.S. Nominee Two”).  That account 

was labeled the “Bancor Account.”  

174. The Bancor Account was opened by Sun’s team, acting at Sun’s direction, using a 

screen-shot photograph of U.S. Nominee Two and certain of U.S. Nominee Two’s personal 

information, without U.S. Nominee Two’s knowledge or permission. 

B. At Sun’s Direction, His Team Engaged in Wash Trading on Bittrex 

175. Sun controlled the digital wallets and the TRX tokens used to conduct the wash-

trading scheme on Bittrex.  Sun also directed the team of Tron Foundation employees who 

executed the wash trades.  The team kept Sun informed of their activities to ensure that they were 

trading consistent with his directives. 

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176. Starting in or about September 2018, Sun received weekly reports detailing his 

team’s wash-trading activities.  One weekly report dated September 28, 2018, advised Sun that 

the “USD trading pair has started,” referring to the Activity and Bancor Accounts that began 

wash trading on September 26, 2018.  That report also stated that Sun’s team intended “to sell 

TRX” and then would “set up a buying opportunity after the holidays to balance the demand of 

the currency (stabilize profits and losses).” 

177. Another report dated October 30, 2018, stated that Sun’s team would adjust its 

strategy to respond to the drop in “natural,” i.e., legitimate, TRX trading volume.  That report 

also conveyed Sun’s directive that the team increase TRX trading volume: “The boss reminded 

us of the need to increase trade volume, we need to increase the liquid parameter next week, 

concentrate on binance, bittrex, bithumb, upbit exhanges [sic], increase the daily budget to 2.5 

BTC.” 

178. The wash-trading scheme depended, at least in part, on a significant supply of 

TRX.  Sun thus provided his own TRX to his team to facilitate the wash trading. 

179. From about April 18, 2018, through February 11, 2019, Sun’s team engaged in 

wash trades of TRX on Bittrex using Accounts 16 and 17.  During the 249 days when those 

accounts were active, Sun’s team engaged in at least 609,790 wash trades of TRX, averaging 

about 2,449 wash trades per day. 

180. For example, the table below illustrates the wash trading of TRX between 

Accounts 16 and 17 on October 1, 2018: 

Time Buying Account TRX Qty Price Currency Selling Account 

10/01/2018 08:21:04 Account 16 5,455 0.02210007 USDT Account 17 

10/01/2018 08:21:40 Account 17 6,368 0.02210005 USDT Account 16 

10/01/2018 08:22:36 Account 16 5,593 0.02210016 USDT Account 17 

10/01/2018 08:23:21 Account 17 5,407 0.02210011 USDT Account 16 

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Time Buying Account TRX Qty Price Currency Selling Account 

10/01/2018 08:24:02 Account 16 4,322 0.02210019 USDT Account 17 

10/01/2018 08:24:40 Account 17 5,609 0.02210012 USDT Account 16 

10/01/2018 08:25:23 Account 16 6,104 0.02210004 USDT Account 17 

10/01/2018 08:26:10 Account 17 4,883 0.02210019 USDT Account 16 

10/01/2018 08:26:43 Account 16 5,550 0.02210012 USDT Account 17 

10/01/2018 08:27:38 Account 17 5,171 0.02210018 USDT Account 16 

10/01/2018 08:28:24 Account 16 3,310 0.02210010 USDT Account 17 

10/01/2018 08:29:11 Account 17 6,438 0.02210003 USDT Account 16 

10/01/2018 08:30:02 Account 16 4,854 0.02210010 USDT Account 17 

10/01/2018 08:30:51 Account 16 4,829 0.02210008 USDT Account 17 

10/01/2018 08:31:51 Account 17 5,409 0.02210007 USDT Account 16 

10/01/2018 08:32:09 Account 16 1,103 0.00000335 BTC Account 17 

10/01/2018 08:32:39 Account 16 2,330 0.02210016 USDT Account 17 

10/01/2018 08:33:08 Account 17 854 0.00000335 BTC Account 16 

10/01/2018 08:33:15 Account 17 3,752 0.02210013 USDT Account 16 

10/01/2018 08:34:02 Account 16 1,280 0.00000335 BTC Account 17 

10/01/2018 08:34:04 Account 16 5,286 0.02210004 USDT Account 17 

10/01/2018 08:34:53 Account 17 3,856 0.02210005 USDT Account 16 

10/01/2018 08:35:27 Account 16 4,771 0.02210015 USDT Account 17 

10/01/2018 08:36:08 Account 17 1,602 0.02210016 USDT Account 16 

10/01/2018 08:36:46 Account 17 3,457 0.02210005 USDT Account 16 

10/01/2018 08:37:45 Account 16 3,539 0.02210003 USDT Account 17 

10/01/2018 08:38:31 Account 17 3,208 0.02210016 USDT Account 16 

10/01/2018 08:39:03 Account 16 3,293 0.02210013 USDT Account 17 

10/01/2018 08:39:39 Account 17 1,845 0.02210008 USDT Account 16 

10/01/2018 08:40:18 Account 17 3,791 0.02210001 USDT Account 16 

10/01/2018 08:41:00 Account 16 2,029 0.02210019 USDT Account 17 

10/01/2018 08:41:07 Account 17 1,288 0.00000334 BTC Account 16 

10/01/2018 08:41:42 Account 16 1,699 0.02210018 USDT Account 17 

10/01/2018 08:41:50 Account 16 1,086 0.00000334 BTC Account 17 

10/01/2018 08:42:29 Account 16 1,000 0.00000334 BTC Account 17 

10/01/2018 08:42:39 Account 17 3,465 0.02210010 USDT Account 16 

10/01/2018 08:43:19 Account 17 1,499 0.00000334 BTC Account 16 

10/01/2018 08:43:39 Account 16 3,472 0.02210019 USDT Account 17 

10/01/2018 08:43:53 Account 16 633 0.00000334 BTC Account 17 

10/01/2018 08:44:27 Account 16 3,271 0.00000334 BTC Account 17 

10/01/2018 08:44:32 Account 17 2,767 0.02210009 USDT Account 16 

10/01/2018 08:45:05 Account 17 2,068 0.00000335 BTC Account 16 

10/01/2018 08:45:34 Account 16 3,320 0.02210002 USDT Account 17 

10/01/2018 08:45:52 Account 17 2,570 0.00000335 BTC Account 16 

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Time Buying Account TRX Qty Price Currency Selling Account 

10/01/2018 08:46:17 Account 17 3,689 0.02210015 USDT Account 16 

10/01/2018 08:46:54 Account 16 2,050 0.00000335 BTC Account 17 

10/01/2018 08:47:15 Account 16 2,201 0.02200049 USDT Account 17 

10/01/2018 08:47:45 Account 17 1,652 0.00000335 BTC Account 16 

10/01/2018 08:48:13 Account 16 3,707 0.02200132 USDT Account 17 

10/01/2018 08:48:47 Account 16 3,482 0.00000335 BTC Account 17 

10/01/2018 08:49:05 Account 17 2,192 0.02200140 USDT Account 16 

10/01/2018 08:49:49 Account 17 4,330 0.00000335 BTC Account 16 

10/01/2018 08:49:49 Account 17 1,496 0.02200185 USDT Account 16 

10/01/2018 08:50:34 Account 16 4,119 0.00000335 BTC Account 17 

10/01/2018 08:50:43 Account 16 1,712 0.02200213 USDT Account 17 

10/01/2018 08:51:12 Account 17 2,072 0.00000335 BTC Account 16 

10/01/2018 08:51:29 Account 17 3,056 0.02200229 USDT Account 16 

10/01/2018 08:52:59 Account 16 1,711 0.02206305 USDT Account 17 

10/01/2018 08:53:43 Account 17 3,390 0.02206323 USDT Account 16 

10/01/2018 08:54:26 Account 16 3,434 0.02206351 USDT Account 17 

10/01/2018 08:55:17 Account 17 3,429 0.02206397 USDT Account 16 

10/01/2018 08:55:55 Account 16 1,720 0.02206439 USDT Account 17 

10/01/2018 08:56:42 Account 16 2,120 0.02206474 USDT Account 17 

10/01/2018 08:57:15 Account 17 1,790 0.02206493 USDT Account 16 

10/01/2018 08:58:06 Account 16 2,741 0.02206512 USDT Account 17 

10/01/2018 08:58:40 Account 17 2,156 0.02206531 USDT Account 16 

10/01/2018 08:59:25 Account 17 1,956 0.02206574 USDT Account 16 

10/01/2018 09:00:01 Account 16 3,145 0.02206609 USDT Account 17 

10/01/2018 09:00:32 Account 17 3,509 0.02221900 USDT Account 16 

 
181. Between September 26 and October 18, 2018, Sun’s team also engaged in wash 

trades of TRX using the Activity and Bancor Accounts.  During those 23 days, Sun’s team 

engaged in at least 5,426 wash trades of TRX, averaging about 236 wash trades per day.   

182. For example, the table below illustrates the wash trading of TRX between the 

Activity and Bancor accounts on October 7, 2018: 

Time Buyer Account TRX Qty Price Currency Seller  Account 

10/07/2018 10:59:19 Bancor Account 1,857 0.02400000 USD Activity Account 

10/07/2018 11:00:40 Activity Account 1,857 0.02400000 USD Bancor Account 

10/07/2018 11:01:42 Bancor Account 2,219 0.02400000 USD Activity Account 

10/07/2018 11:03:21 Activity Account 2,422 0.02400000 USD Bancor Account 

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Time Buyer Account TRX Qty Price Currency Seller  Account 

10/07/2018 11:04:33 Bancor Account 1,960 0.02400000 USD Activity Account 

10/07/2018 11:06:01 Activity Account 1,154 0.02400000 USD Bancor Account 

10/07/2018 11:07:32 Activity Account 2,537 0.02400000 USD Bancor Account 

10/07/2018 11:09:29 Bancor Account 2,712 0.02400000 USD Activity Account 

10/07/2018 11:10:38 Activity Account 2,503 0.02400000 USD Bancor Account 

10/07/2018 11:12:33 Bancor Account 2,011 0.02400000 USD Activity Account 

10/07/2018 11:14:03 Activity Account 1,683 0.02400000 USD Bancor Account 

10/07/2018 11:15:55 Bancor Account 1,159 0.02400000 USD Activity Account 

10/07/2018 11:17:22 Bancor Account 1,099 0.02400000 USD Activity Account 

10/07/2018 11:19:03 Activity Account 1,048 0.02400000 USD Bancor Account 

10/07/2018 11:20:53 Bancor Account 2,119 0.02400000 USD Activity Account 

10/07/2018 11:22:43 Activity Account 2,477 0.02400000 USD Bancor Account 

10/07/2018 11:23:59 Bancor Account 2,600 0.02400000 USD Activity Account 

10/07/2018 11:25:18 Activity Account 1,518 0.02400000 USD Bancor Account 

10/07/2018 11:26:47 Activity Account 1,963 0.02400000 USD Bancor Account 

10/07/2018 11:28:42 Bancor Account 1,130 0.02400000 USD Activity Account 

10/07/2018 11:30:39 Bancor Account 2,438 0.02400000 USD Activity Account 

10/07/2018 11:32:15 Activity Account 1,672 0.02400000 USD Bancor Account 

10/07/2018 11:33:25 Activity Account 2,371 0.02400000 USD Bancor Account 

10/07/2018 11:34:43 Bancor Account 2,008 0.02400000 USD Activity Account 

10/07/2018 11:36:40 Activity Account 1,023 0.02400000 USD Bancor Account 

10/07/2018 11:38:23 Bancor Account 1,581 0.02400000 USD Activity Account 

10/07/2018 11:40:05 Activity Account 1,323 0.02400000 USD Bancor Account 

10/07/2018 11:41:16 Bancor Account 1,817 0.02400000 USD Activity Account 

10/07/2018 11:43:01 Activity Account 1,975 0.02400000 USD Bancor Account 

10/07/2018 11:44:51 Bancor Account 2,794 0.02400000 USD Activity Account 

10/07/2018 11:45:56 Activity Account 2,530 0.02400000 USD Bancor Account 

10/07/2018 11:46:58 Bancor Account 2,437 0.02400000 USD Activity Account 

10/07/2018 11:49:00 Activity Account 2,574 0.02400000 USD Bancor Account 

10/07/2018 11:50:25 Bancor Account 1,610 0.02400000 USD Activity Account 

10/07/2018 11:52:06 Activity Account 974 0.02400000 USD Bancor Account 

10/07/2018 11:53:41 Bancor Account 1,483 0.02400000 USD Activity Account 

10/07/2018 11:54:56 Activity Account 1,530 0.02400000 USD Bancor Account 

10/07/2018 11:56:00 Bancor Account 1,814 0.02400000 USD Activity Account 

10/07/2018 11:57:17 Activity Account 670 0.02400000 USD Bancor Account 

10/07/2018 11:59:03 Activity Account 1,803 0.02400000 USD Bancor Account 

10/07/2018 12:00:30 Bancor Account 634 0.02400000 USD Activity Account 

10/07/2018 12:01:55 Bancor Account 1,090 0.02400000 USD Activity Account 

10/07/2018 12:03:52 Activity Account 1,643 0.02400000 USD Bancor Account 

10/07/2018 12:05:42 Bancor Account 692 0.02400000 USD Activity Account 

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Time Buyer Account TRX Qty Price Currency Seller  Account 

10/07/2018 12:07:01 Activity Account 683 0.02400000 USD Bancor Account 

10/07/2018 12:08:34 Bancor Account 830 0.02400000 USD Activity Account 

10/07/2018 12:09:38 Activity Account 1,792 0.02400000 USD Bancor Account 

10/07/2018 13:08:39 Bancor Account 1,805 0.02400000 USD Activity Account 

10/07/2018 14:51:32 Activity Account 2,227 0.02500000 USD Bancor Account 

10/07/2018 15:06:00 Bancor Account 1,339 0.02500000 USD Activity Account 

10/07/2018 15:07:16 Activity Account 3,107 0.02500000 USD Bancor Account 

10/07/2018 16:03:39 Activity Account 3,529 0.02600000 USD Bancor Account 

10/07/2018 23:04:34 Bancor Account 1,416 0.02600000 USD Activity Account 

10/07/2018 23:11:44 Activity Account 1,286 0.02700000 USD Bancor Account 

10/07/2018 23:12:48 Bancor Account 1,403 0.02700000 USD Activity Account 

10/07/2018 23:14:49 Activity Account 2,107 0.02700000 USD Bancor Account 

10/07/2018 23:22:54 Activity Account 1,746 0.02700000 USD Bancor Account 

10/07/2018 23:24:16 Bancor Account 956 0.02700000 USD Activity Account 

10/07/2018 23:25:18 Bancor Account 1,274 0.02700000 USD Activity Account 

10/07/2018 23:26:57 Activity Account 1,249 0.02700000 USD Bancor Account 

10/07/2018 23:33:39 Bancor Account 1,905 0.02700000 USD Activity Account 

10/07/2018 23:35:15 Activity Account 2,030 0.02700000 USD Bancor Account 

10/07/2018 23:49:33 Bancor Account 1,576 0.02700000 USD Activity Account 

10/07/2018 23:50:49 Activity Account 2,845 0.02700000 USD Bancor Account 

10/07/2018 23:51:52 Bancor Account 1,996 0.02700000 USD Activity Account 

10/07/2018 23:52:54 Activity Account 2,959 0.02700000 USD Bancor Account 

10/07/2018 23:59:18 Bancor Account 2,059 0.02700000 USD Activity Account 
 

183. As illustrated in the tables above, the two account pairs—(1) Accounts 16 and 17 

and (2) the Activity and Bancor Accounts—engaged in numerous wash trades of TRX on 

Bittrex.   

184. As reflected in a December 2018 application filed by the BitTorrent Foundation to 

make BTT available for trading on a new trading platform, the BitTorrent Foundation also 

owned and controlled Accounts 16 and 17. 

185. At all relevant times, Sun, acting through the Tron Foundation, the BitTorrent 

Foundation, and Rainberry, controlled each of the wash-trading accounts, and the trades of TRX 

in those accounts were executed at Sun’s direction and with his knowledge.  None of the TRX 

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trades between those accounts involved any change in beneficial ownership or had any legitimate 

economic purpose. 

186. A reasonable investor considering whether to buy or sell TRX would have 

deemed it important to know that the trading volume of TRX was affected and inflated by wash 

trading.  But Sun and the rest of the Sun Defendants did not disclose that fact. 

VI. The Sun Defendants Orchestrated a Celebrity Touting Campaign and Sun Lied to 
Conceal It 

187. Beginning in or about January 2021, Sun, acting on behalf of the Tron 

Foundation, the BitTorrent Foundation, and Rainberry, began paying celebrities located in the 

United States, including Defendants Mahone and Way, among others, to promote TRX and BTT 

on social media.  Each of the celebrities who touted TRX or BTT had at least one million 

followers on their social media accounts, including followers located in the United States.  But 

the celebrities did not disclose the fact that they were paid to tout TRX or BTT or the amounts of 

the payments they received. 

188. Sun, acting on behalf of the Tron Foundation, the BitTorrent Foundation, and 

Rainberry, approved the payments to the celebrities for their touts of TRX or BTT, respectively, 

and he funded the payments with his own assets.  Sun, working with a Rainberry employee (the 

“Rainberry Employee”), arranged payments to the celebrities based in the United States who 

touted TRX and/or BTT.  Additionally, Sun instructed the Rainberry Employee to ensure that 

those celebrities did not disclose the fact that they were paid to tout the tokens.  Sun’s directive 

was communicated to the celebrities directly or indirectly through intermediaries, including the 

Rainberry Employee.   

189. Sun or the Rainberry Employee acting at his direction, each acting on behalf of 

the Tron Foundation, the BitTorrent Foundation, and Rainberry, provided or approved the 

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specific language that Sun wanted each celebrity to post online to tout TRX and BTT.  Sun then 

amplified the celebrities’ promotional posts on social media by commenting on those posts or 

retweeting them to Sun’s more than three million Twitter followers, including followers located 

in the United States.   

190. Sun, acting on behalf of the Tron Foundation, the BitTorrent Foundation, and 

Rainberry, thus created the misleading impression that celebrities were independently interested 

in investing in TRX and/or BTT.  In fact, the celebrities only touted TRX and/or BTT because 

they were paid to do so. 

191. On or about January 22, 2021, Way tweeted: “thanks guys, bought some … TRX 

… 💪 what’s next? let’s go ✔.”  Later, on or about January 28, 2021, Sun and Way exchanged 

electronic messages on Twitter, and Sun stated that he sent Way a payment in the form of crypto 

assets.  The next day, on or about January 29, 2021, Way tweeted: “✔$trx = fast blockchain.”  

The Tron Foundation, through either Sun or the Rainberry Employee acting at his direction, 

provided the language for Way’s tweets, and, as noted above, Sun paid Way for his promotional 

tweets with crypto assets that were worth approximately $10,000.  But neither of Way’s tweets 

disclosed the fact that Way had been paid to tout TRX or the amount of his payment. 

192. On or about February 11, 2021, an American actress tweeted: “Exploring #DeFi 

and already liking $JST, $SUN on $TRX.  Super fast and 0 fee.  Good job @ justinsuntron.”  

That same day, another American actress based in the United States tweeted: “People should use 

only $TRX cause it’s fast, cheap and hot . . . thanks @justinsuntron.”  The Tron Foundation, 

through either Sun or the Rainberry Employee acting at his direction, provided the language for 

each of those tweets.  Also that same day, an American singer based in the United States 

tweeted: “What’s an ideal crypto bag?  Thinking $TRX $BTT $JST $SUN $WIN.”  The Tron 

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Foundation and BitTorrent Foundation, through either Sun or the Rainberry Employee acting at 

his direction, provided the language for each of those tweets.  Sun arranged for these three 

celebrities to be paid $10,000, $955.70, and $12,000, respectively, for their tweets.  None of 

those tweets, however, disclosed the fact that the celebrities were paid to tout TRX or BTT or the 

amounts the payments.   

193. The next day, on or about February 12, 2021, Mahone tweeted: “When $TRX hits 

50 cents and $BTT hits 1 cent I’m getting a tattoo of @justinsuntron’s face.”  The Tron 

Foundation and BitTorrent Foundation, through either Sun or the Rainberry Employee acting at 

his direction, provided the language for Mahone’s tweet, and Sun arranged for Mahone to be 

paid bitcoin valued at approximately $7,507 for the tweet.  Mahone’s tweet did not disclose the 

fact that he had been paid to tout TRX or BTT or the amount of his payment.   

194. To conceal the truth about the celebrity touting campaign from the investing 

public, Sun falsely denied that he and the Tron Foundation paid celebrities to tout.  On or about 

February 16, 2021, Sun tweeted: “There have been rumors lately of third party celebrities being 

paid to promote #TRON.  #TRON Foundation is not involved in these activities.  Nor is the 

foundation aware of the actors behind this.”  That same day, about one minute later, Sun 

tweeted: “If any celebrities are paid to promote TRON, we require them to disclose.”   

195. Those tweets by Sun were false.  In fact, as Sun knew, celebrities were paid to 

tout TRX and BTT; the Tron Foundation and BitTorrent Foundation, through either Sun or the 

Rainberry Employee acting at his direction, provided the language for the touts; Sun arranged 

and funded payments to the celebrities for the touts; and the celebrities did not disclose the fact 

that they were paid to tout TRX or BTT or the amounts of their payments. 

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196. A reasonable investor considering whether to buy or sell TRX or BTT would have 

deemed it important to know that celebrities were paid to promote TRX and BTT.  But the 

celebrities’ promotional statements did not disclose their payments, and Sun’s false statements 

further concealed those payments from the investing public. 

FIRST CLAIM FOR RELIEF 

Violation of Sections 5(a) and (c) of the Securities Act 
(Against Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry) 

 
197. Paragraphs 1 through 199 above are re-alleged and incorporated by reference. 

198. By their conduct alleged herein, the Sun Defendants, directly or indirectly, 

without a registration statement filed and in effect as to securities, (a) made use of the means and 

instruments of transportation or communications in interstate commerce or of the mails to sell 

securities through the use of any prospectus or otherwise; (b) carried or caused to be carried 

through the mails or in interstate commerce, by any means or instruments of transportation, 

securities for the purpose of sale or for delivery after sale; and (c) made use of the means and 

instruments of transportation or communication in interstate commerce or of the mails to offer to 

sell securities through the use or medium of a prospectus or otherwise. 

199. The Sun Defendants thus violated, and unless restrained and enjoined will 

continue to violate, Sections 5(a) and (c) of the Securities Act, 15 U.S.C. § 77e(a) and (c). 

SECOND CLAIM FOR RELIEF 

Violation of Sections 17(a)(1) and (a)(3) of the Securities Act 
(Against Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry) 

 
200. Paragraphs 1 through 199 above are re-alleged and incorporated by reference. 

201. By their conduct alleged herein, the Sun Defendants, in the offer or sale of 

securities, by the use of means or instrumentalities of transportation or communication in 

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interstate commerce or by use of the mails, directly or indirectly:  (1) knowingly or recklessly 

employed devices, schemes, or artifices to defraud; and (2) knowingly, recklessly, or negligently 

engaged in transactions, practices, or courses of business which operated or would operate as a 

fraud or deceit upon the purchaser. 

202. The Sun Defendants thus violated, and unless restrained and enjoined will 

continue to violate, Sections 17(a)(1) and (a)(3) of the Securities Act, 15 U.S.C. § 77q(a)(1) and 

(a)(3). 

THIRD CLAIM FOR RELIEF 

Violation of Sections 9(a)(1) and (a)(2) of the Exchange Act 
(Against Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry) 

 
203. Paragraphs 1 through 199 above are re-alleged and incorporated by reference. 

204. By their conduct alleged herein, the Sun Defendants, directly or indirectly, by the 

use of the mails or any means or instrumentality of interstate commerce, or of a facility of any 

national securities exchange, (1) for the purpose of creating a false or misleading appearance of 

active trading in any security, or a false or misleading appearance with respect to the market for 

any such security, (A) effected transactions in securities that involved no change in the beneficial 

ownership thereof, and (B) entered orders for the purchase of securities with the knowledge that 

orders of substantially the same size, at substantially the same time, and at substantially the same 

price, for the sale of such securities, had been or would be entered by or for the same or different 

parties, and (C) entered orders for the sale of securities with the knowledge that orders of 

substantially the same size, at substantially the same time, and at substantially the same price, for 

the purchase of such securities, had been or would be entered by or for the same or different 

parties; and (2) effected, alone or with one or more other persons, a series of transactions in 

securities registered on a national securities exchange, any security not so registered, or in 

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connection with any security-based swap or security-based swap agreement with respect to such 

security, creating actual or apparent active trading in such securities, or raising or depressing the 

price of such securities, for the purpose of inducing the purchase or sale of such securities by 

others. 

205. The Sun Defendants thus violated, and unless restrained and enjoined will 

continue to violate, Sections 9(a)(1) and (a)(2) of the Exchange Act, 15 U.S.C. § 78i(a)(1) and 

(a)(2). 

FOURTH CLAIM FOR RELIEF 

Violation of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder 
(Against Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry) 

 
206. Paragraphs 1 through 199 above are re-alleged and incorporated by reference. 

207. By their conduct alleged herein, the Sun Defendants, directly or indirectly, in 

connection with the purchase or sale of securities, by the use of the means or instrumentalities of 

interstate commerce or of the mails, or of any facility of any national securities exchange, 

knowingly or recklessly, (a) employed devices, schemes, or artifices to defraud; (b) made untrue 

statements of material fact or omitted to state material facts necessary in order to make the 

statements made, in the light of the circumstances under which they were made, not misleading; 

and (c) engaged in acts, practices, or courses of business which operated or would operate as a 

fraud or deceit upon any person. 

208. The Sun Defendants thus violated, and unless restrained and enjoined will 

continue to violate, Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5 

thereunder, 17 C.F.R. § 240.10b-5. 

 

 

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FIFTH CLAIM FOR RELIEF 

Violation of Section 17(b) of the Securities Act 
(Against Mahone and Way) 

 
209. Paragraphs 1 through 199 above are re-alleged and incorporated by reference. 

210. By their conduct alleged herein, Mahone and Way, by the use of any means or 

instruments of transportation or communication in interstate commerce or by the use of the 

mails, published, gave publicity to, or circulated a notice, advertisement, or communication, 

which, though not purporting to offer a security for sale, described a security, for a consideration 

received or to be received, directly or indirectly, from an issuer, underwriter, or dealer, without 

fully disclosing the receipt of such consideration and the amount thereof. 

211. Mahone and Way thus violated, and unless restrained and enjoined will continue 

to violate, Section 17(b) of the Securities Act, 15 U.S.C. § 77q(b). 

SIXTH CLAIM FOR RELIEF 

Aiding and Abetting Violation of Section 17(b) of the Securities Act 
(Against Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry) 

 
212. Paragraphs 1 through 199 above are re-alleged and incorporated by reference. 

213. As set forth above, by their conduct alleged herein, Mahone and Way, among 

other celebrities, violated Section 17(b) of the Securities Act, 15 U.S.C. § 77q(b). 

214. The Sun Defendants knowingly or recklessly provided substantial assistance to 

Mahone and Way, among other celebrities, in their violations of Section 17(b) of the Securities 

Act. 

215. The Sun Defendants thus aided and abetted, and unless restrained and enjoined 

will continue to aid and abet, violations of Section 17(b) of the Securities Act by celebrities, 

including Mahone and Way. 

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PRAYER FOR RELIEF 

Accordingly, the SEC respectfully requests that the Court enter a Final Judgment:  

A. Finding that Defendants, except Mahone (who settled with the SEC), committed 

the violations alleged in this Complaint; 

B. Permanently restraining and enjoining the Sun Defendants from violating 

Sections 5(a) and (c) of the Securities Act, 15 U.S.C. § 77e(a) and (c); Sections 17(a)(1) and 

(a)(3) of the Securities Act, 15 U.S.C. § 77q(a)(1) and (a)(3); Section 17(b) of the Securities Act, 

15 U.S.C. § 77q(b); Sections 9(a)(1) and (a)(2) of the Exchange Act, 15 U.S.C. § 78i(a)(1) and 

(a)(2); Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b); and Rule 10b-5 thereunder, 17 

C.F.R. § 240.10b-5; 

C. Permanently restraining and enjoining Way from violating Section 17(b) of the 

Securities Act, 15 U.S.C. § 77q(b); 

D. Imposing a conduct-based injunction pursuant to Section 21(d)(5) of the 

Exchange Act, 15 U.S.C. § 78u(d)(5), prohibiting the Sun Defendants from participating, directly 

or indirectly, including through any entity controlled by them, in any offer or sale of securities, 

including any crypto asset security; provided, however, that such injunction shall not prevent 

Sun from purchasing or selling non-crypto asset securities for his own personal account; 

E. Imposing a conduct-based injunction pursuant to Section 21(d)(5) of the 

Exchange Act, 15 U.S.C. § 78u(d)(5), prohibiting Way from receiving or agreeing to receive any 

form of compensation or consideration, directly or indirectly, from any issuer, underwriter, or 

dealer, for directly or indirectly publishing, giving publicity to, or circulating any notice, circular, 

advertisement, newspaper, article, letter, investment service, or communication which, though 

not purporting to offer a crypto asset security, for sale, describes such crypto asset security; 

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F. Permanently prohibiting Sun, pursuant to Section 21(d)(2) of the Exchange Act, 

15 U.S.C. § 78u(d)(2), and Section 20(e) of the Securities Act, 15 U.S.C. § 77t(e), from acting as 

an officer or director of any issuer that has securities registered pursuant to Section 12 of the 

Exchange Act or that is required to file reports pursuant to Section 15(d) of the Exchange Act; 

G. Ordering the Sun Defendants to disgorge, jointly and severally, all of the ill-

gotten gains that they received from the violations alleged herein, plus prejudgment interest, 

pursuant to Sections 21(d)(3), (5) and (7) of the Exchange Act, 15 U.S.C. §§ 78u(d)(3), (5) and 

(7);  

H. Ordering Way to disgorge all of the ill-gotten gains that he received from the 

violations alleged herein, plus prejudgment interest, pursuant to Sections 21(d)(3), (5) and (7) of 

the Exchange Act, 15 U.S.C. §§ 78u(d)(3), (5) and (7); 

I. Ordering Defendants, except Mahone (who settled with the SEC), to pay civil 

monetary penalties pursuant to Section 20(d) of the Securities Act, 15 U.S.C. § 77t(d), and 

Section 21(d)(3) of the Exchange Act, 15 U.S.C. § 78u(d)(3); and 

J. Granting such further relief as the Court deems appropriate for the protection of 

investors. 

JURY DEMAND 

The SEC demands a trial by jury on all issues so triable. 

Dated:  April 18, 2024   Respectfully submitted, 
 
/s/ Timothy K. Halloran    
Timothy K. Halloran (admitted pro hac vice) 
Adam B. Gottlieb 
Securities and Exchange Commission  
100 F Street, NE 
Washington, DC 20549  
Tel:  202-551-4414 (Halloran) 
Email:  [email protected] 

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