SEC moves to dismiss securities lawsuit against crypto influencer Ian Balina

Cryptocurrency influencer and Token Metrics CEO Ian Balina is the latest figure to have an SEC unregistered securities sales case dropped.

According to a May 1 joint stipulation filed in a Texas federal court, the U.S. Securities and Exchange Commission said it “believes the dismissal of this case is appropriate,” and asked the court to end the case without costs or fees to either side.

Balina, who became a well-known figure during the 2017 ICO boom, had already hinted at the outcome last month. In a March 13 post on X, he told followers “it’s official” the SEC was dropping the case, framing it as a broader victory for fairness in the crypto space. 

“This was never just about me,” he added. 

His AI-driven investment research platform, Token Metrics, echoed the sentiment in a separate post, while suggesting the dismissal could point to a larger shift in enforcement trends. See below.

While the commission did not provide a specific reason for the dismissal, it stated in the joint stipulation that the move “does not necessarily reflect the Commission’s position on any other case.”

The case against Balina dates back to 2022, when the SEC accused him of violating federal securities laws by promoting and reselling SPRK tokens, linked to a project called Sparkster, without registering the offering or disclosing that he had been compensated to promote it.

At the centre of the case was a 2018 Telegram-based investing pool Balina allegedly formed with around 68 individuals, where he resold $5 million worth of SPRK tokens he had purchased with a 30% bonus for promotional efforts.

At the time, the commission claimed these tokens were unregistered securities and said Balina failed to meet disclosure obligations.

In May 2024, the court sided with the SEC on a key point, ruling that SPRK tokens were securities under the Howey Test and that U.S. securities laws applied to Balina’s conduct.

The court also said Balina acted as an underwriter by redistributing tokens through his investment pool. 

While Balina tried to get the case thrown out in full, the judge denied his motion and allowed the SEC’s charge under Section 17(b), regarding undisclosed promotion, to proceed.

It’s worth noting that Sparkster and its CEO previously settled with the SEC in 2022 after agreeing to pay over $35 million to affected investors.

In recent months, the SEC has stepped back from several high-profile crypto enforcement actions, withdrawing from cases tied to major platforms such as Binance, Coinbase, Kraken, Robinhood, Uniswap, Gemini, and OpenSea.

These involved a range of allegations, from unregistered securities sales to broader regulatory violations, which are now being dropped under the current administration.

As previously reported by crypto.news, on April 23, the commission dropped similar charges against Hex founder Richard Heart.