Crypto influencer Ian Balina has been found guilty by a Texas federal court for violating securities laws by selling unregistered securities to US investors. The court ruled in favor of the Securities and Exchange Commission (SEC) in a case filed in 2022, accusing Balina of illegally promoting and selling Spakster (SPRK) tokens.
Judge David Alan Ezra based his decision on the Howey test, determining that SPRK tokens met the criteria of an investment contract. The court also agreed with the SEC’s argument that Balina targeted US investors, despite his claim that the sales took place overseas.
While the court dismissed the SEC’s accusation that Balina failed to disclose a compensation agreement with Sparkster CEO Sajjad Daya, it did find him guilty of not informing investors about a 30% bonus he received for his token purchases.
Sparkster conducted its ICO for SPRK tokens from April to July 2018, marketing itself as a blockchain application development platform. The company reached a settlement with the SEC in September 2022, agreeing to pay $30 million in disgorgement, $4.6 million in interest, and a $500,000 civil penalty.
This case highlights the SEC’s efforts to regulate the crypto market and enforce securities laws. In related news, the SEC has issued a Wells notice against Uniswap, alleging it operates as an unregistered securities exchange, a claim that Uniswap has refuted.
With a background in Economics and a decade of experience in the FinTech industry, Aaron is a passionate analyst who provides data-driven and fact-based content on digital currencies. He aims to make the crypto space more approachable to beginners and is dedicated to transforming the industry.
