The U.S. Securities and Exchange Commission (SEC) is charging crypto influencer Ian Balina for his alleged involvement in the 2018 initial coin offering (ICO) of the SPRK token.
in a complain The SEC filed a lawsuit on Sept. 19 in the U.S. District Court for the Western District of Texas, saying it is taking legal action against Balina, accusing it of promoting and selling a cryptoasset, which the regulator says is an unregistered security.
The SEC further charged that the YouTuber failed to disclose the amount he received from the token issuer, software development company Sparkster, and his own unregistered SPRK offering.
“Although he agreed to receive a 30% bonus from Sparkster for the tokens he purchased in Sparkster’s product, Balina never publicly disclosed the consideration he received for the promotion.
Balina also organized an investment pool of about 50 people on Telegram. After he agreed to purchase SPRK tokens from Sparkster, Balina offered members of the investment pool the opportunity to purchase SPRK tokens from him at launch. “
The offering, which took place via the Ethereum (ETH) network, raised $30 million from nearly 4,000 investors from the U.S. and abroad who paid in ETH.
In a bid to establish U.S. jurisdiction in the case, the SEC said ethereum-based transactions are believed to take place in the country because most of the network’s nodes are based there.
“When U.S. investors in the Balina Pool send their ETH donations to the Balina Pool from within the U.S., they irrevocably commit to the transaction. At that time, their ETH contribution is backed up on the Ethereum blockchain. Validation of a network of nodes that are clustered more densely in the U.S. than in any other country. As a result, these transactions take place in the U.S.”
SEC files lawsuit as it takes tougher stance on cryptocurrencies hinder Institutions enter the field of digital assets. During a congressional hearing last week, SEC Chairman Gary Gensler Say Most crypto companies trade securities and must register with the commission.He also hinted that Ethereum can now be classified as Safety After its incorporation into Proof of Stake.
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