TLDR
- The SEC plans to drop its lawsuit against crypto influencer Ian Balina over his promotion of Sparkster (SPRK) tokens in 2018
- Balina allegedly received a 30% bonus on his $5 million investment but didn’t disclose this to followers
- The case is one of many crypto enforcement actions the SEC has stopped pursuing since January 2025 following the Trump administration’s arrival
- Sparkster previously settled with the SEC for $35.1 million over unregistered securities violations
- The shift suggests a new, potentially more crypto-friendly approach from the SEC under acting Chair Mark Uyeda
The Securities and Exchange Commission (SEC) has dropped its case against crypto influencer and Token Metrics CEO Ian Balina. The case was related to his promotion of Sparkster tokens during the 2018 Initial Coin Offering (ICO) boom.
Balina announced the news to Cointelegraph on March 11. He stated that the SEC had informed him they would recommend the court dismiss the case filed in 2022.
The SEC originally accused Balina of violating securities laws. The complaint alleged he promoted SPRK tokens without disclosing he received a 30% bonus on his $5 million investment.
🚨 SEC CASE DROPPED. WE WON.
The SEC dropped its case against @DiaryofaMadeMan
A huge moment for crypto and a possible shift in enforcement trends.
The future of crypto is transparency and data-driven research.
We’ll keep leading the way at @TokenMetricsInc.
Thanks to…
— Token Metrics (@tokenmetricsinc) March 12, 2025
This bonus arrangement was not shared with Balina’s social media followers. At the time, he had over 100,000 YouTube subscribers who followed his crypto investment advice.
The case had been moving through the legal system for years. In May 2024, a judge ruled that “SPRK tokens qualify as securities” under the SEC’s oversight.
Balina’s legal team had planned to appeal this decision. A jury trial was initially set for January 2025 but was later postponed.
The dropping of the case wasn’t cheap for Balina.
“It cost a lot of money in terms of legal fees, which definitely sucks,” he told Cointelegraph.
Balina credits the change to the new administration’s priorities. He specifically mentioned President Donald Trump’s appointment of acting SEC Chair Mark Uyeda following Gary Gensler’s departure in January.
“Obviously, the new administration is pro-crypto,” Balina said. He added that the “time has ended” for crypto regulation through enforcement actions.
This case is not unique. Since January, the SEC has stopped pursuing investigations against several crypto companies including Robinhood Crypto, Gemini, Uniswap, and OpenSea.
The commission has also dropped cases against other major crypto players. This includes Coinbase, Consensys, Kraken, and others.
The SEC still has an open case against Ripple Labs. This involves an appeal following a $125 million judgment from August 2024.
The Sparkster project itself previously settled with the SEC in 2022. Without admitting wrongdoing, CEO Sajjad Daya agreed to several terms.
These included destroying remaining tokens, requesting their removal from exchanges, and publicly posting the SEC’s order. Sparkster also paid $30 million in disgorgement, $4.6 million in interest, and a $500,000 civil penalty.
The $30 million represented the full value of the ETH raised during the ICO. Daya reportedly failed to cash out before the crypto market crashed.
By the time he finally sold the ETH, he received just $900,000. This was far less than the original fundraise value.
The Sparkster token launch was troubled from the start. The price dropped 92% on its first day of trading.
Investors who had bought in based on Balina’s promotion turned against him. They blamed him for hyping a project that collapsed immediately upon launch.
Some critics suggest the crypto industry has gained influence with the Trump administration. They point to industry support for Republican candidates in the 2024 election.
President Trump recently hosted a crypto summit at the White House on March 7. Many industry leaders who supported “pro-crypto” candidates attended.
Representatives from companies like Robinwood, Gemini, Coinbase, and Kraken were present at this meeting. Many of these are the same companies that have seen enforcement actions dropped.
The SEC declined to comment when contacted by Cointelegraph about Balina’s case. As of publication, no official court filing requesting dismissal had appeared in the docket.
