SEC Charges Crypto Influencer for Promoting Unregistered ICO

Sparkster, a project that promised a “no-code” software creation platform, raised over $30 million from its initial coin offering in July 2018

article-image

Source: DALL·E

share

key takeaways

  • Influencer and crypto promoter Ian Balina latest to be targeted by the SEC
  • According to the SEC, Balina agreed to invest around $5 million in the Sparkster offering and promote the offered SPRK tokens on YouTube, Telegram and other social media platforms

The US Securities and Exchange Commission has charged self-described crypto influencer Ian Balina for actions related to the offering and promotion of SPRK tokens, according to a court filing released Monday. 

Balina, who promoted SPRK tokens in 2018, failed to disclose to investors that he was compensated by the issuer, the SEC alleges in the suit. He also “failed to file a registration statement with the SEC for the tokens that he re-sold using an investing pool that he organized,” the filing states. 

Sparkster, a project that promised a “no-code” software creation platform, raised over $30 million from its initial coin offering in July 2018. After raising the funds, the project never materialized, as far as investors were concerned. In May 2022, Sparkster appeared in headlines again after the otherwise dormant blockchain appeared to convert $22 million in ether into USDC. 

According to the SEC, Balina agreed to invest around $5 million in the Sparkster offering and promote the offered SPRK tokens on YouTube, Telegram and other social media platforms. Balina’s agreement also came with a 30% bonus from Sparkster on the tokens he purchased in the Sparkster offering, but Balina never publicly disclosed the commission he received for his promotion, the SEC alleges. 

The court filing comes as fallout from the popular ICO days of 2018 continues to persist in the crypto industry. 

The SEC sued settlement system Ripple and two executives — founder Christian Larsen and CEO Brad Garlinghouse — about two years ago over allegations that its XRP token was an unregistered security offering. Ripple disputed the allegations and claimed XRP should be treated as virtual currency, not a security. If both parties get their way, the legal battle will be determined by a federal judge in a summary judgment.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the On the Margin newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2024

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

AERODROME TEMPLATE.png

Research

Aerodrome is a "MetaDEX" that combines elements of various DEX primitives such as Uniswap V2 and V3, Curve, Convex, and Votium. Since its launch on Base, it has become the largest protocol by TVL with more than $495M in value locked, doubling Uniswap's Base deployment.

article-image

Scientific reputation should be determined by a decentralized community of scientists, not the validation of higher institutions

article-image

Paxos is getting off scot-free after the SEC said it wouldn’t pursue legal action against the company

article-image

The Srcful partnership is part of a broader plan to onboard Helium “subnetworks”

article-image

Plus, a look into US spot BTC funds six months into trading

article-image

A Swedish energy-focused project named Srcful proposed to become a Helium subnetwork with its own ENERGY token

article-image

Securitize CEO Carlos Domingo thinks BUIDL will potentially hit its next $500 million milestone in just a few months