"Justin Sun has had to deal with the SEC and disappointed many investors."
The Securities and Exchange Commission (SEC) of the United States (US) has charged Justin Sun and his three companies, namely Tron Foundation Limited, BitTorrent Foundation and Rainberry, after allegedly selling Tron (TRX) and BitTorrent (BTT) cryptocurrencies unregistered.
In a separate indictment, the regulator said that Sun had engaged in a wash trade*, where he was found to be manipulating the TRX market.
*A form of market manipulation where investors sell and buy the same financial instrument simultaneously to create confusion.
This is because Sun artificially increased TRX trading volume by having its own employees engage in 600,000 wash trades of the digital asset between two crypto asset trading platform accounts it controls.
According to official documents published by the SEC, the daily volume of digital assets traded through wash trade is between 4.5 million to 7.4 million TRX.
In the meantime, the SEC also filed charges against eight famous celebrities, including actress Lindsay Lohan, singer Austin Mahone and media personality Jake Paul for illegally supporting TRX and BTT without disclosing that they were compensated for doing so.
Even so, all the celebrities except Mahone and rapper DeAndre Cortez Way have agreed to pay $400,000 including disgorgement**, interest and penalties to settle the allegations.
**Repayment of ill-gotten gains imposed on the offender by the court
Reacting to the following news, the price of TRX plunged by 9.20% at $0.06 in the last 24 hours after investors of the digital asset rushed to sell their holdings.
