Crypto influencer Balina says he’s prepared to fight the charges to the US Supreme Court.
A Texas district court has confirmed that crypto investor and YouTuber Ian Balina indeed broke US securities laws by offering and selling SPRK tokens. This follows after the United States Securities and Exchange Commission (SEC) charged the influencer in September 2022 for his role in what was an unregistered initial coin offering (ICO). At the time, the SEC focused its allegations on the ICO for Sparkster, a supposed “no-code” development platform.
Interestingly, Sparkster did not exactly admit to any wrongdoing on its part, and neither did it deny the SEC’s claims. However, the platform did agree to dump its remaining tokens in 2022.
Furthermore, the SEC claimed that Balina bought at least $5 million worth of SPRK tokens and promoted them across several of his social media pages. Those include YouTube, Telegram, and some more. The regulator further added that Balina did not at any point tell his followers that he had a 30% bonus agreement with Sparkster as promotion fees. Then, there was a time when Balina also reportedly put together an “investing pool” of about 68 people. According to the SEC, he should have registered the offering before offering and selling those tokens to them.
Court Holds Ian Balina Culpable
In a new turn of events, the judge at the Texas district court has said that securities laws applied to Balina as SPRK tokens met the criteria of the Howey Test. The judge’s statement reads partly:
“The Court holds as a matter of law that US securities laws apply to Balina’s conduct and that the SPRK tokens are securities.”
For context, the Howey Test is a 1946 US Supreme Court case that the SEC frequently refers to in most of its crypto-related cases. The SEC believes that the case serves as a perfect reference in determining if an asset qualifies as an investment contract and if it should therefore be classified as a security.
Interestingly, Balina appears to be ready to fight tooth and nail with the SEC over this matter. In a post on his website, Balina called the SEC’s charges “baseless and gross misconceptions.” He also added that he’s prepared to fight the charges to the US Supreme Court.
next