SEC Files Lawsuit Against Crypto Influencer

On September 19, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit in U.S. District Court against social media influencer and cryptocurrency investor Ian Balina. The lawsuit alleges that he violated federal securities laws by secretly endorsing SPRK Tokens without disclosing his reimbursement for doing so.

Balina, a self-proclaimed crypto millionaire, shared his expertise with those who want to invest in ICOs. His wealth of knowledge comes from his years of experience with cryptocurrency investments. He shares in-depth information on YouTube and other social media platforms.

Balina’s information postings, including How To Make Millions With Initial Coin Offerings (ICOs), which has amassed more than 350k views to date. He offers strategies that, in his opinion, will give investors the best chance at success during this uncertain time.

He now has approximately 110,000 Twitter followers, and his videos have cumulatively been seen by over 2 million viewers so far. Balina had stated before that he created his own following on social media after seeing the value he could provide to others.

However, this SEC’s action is about Ian Balina’s unregistered offering and promotion in 2018 of crypto asset securities SPRK Tokens. He started an investing pool through which he distributed tokens – recommended and bought by him- to his investors.

The Unregistered Offering Of SPRK Tokens

Sparkster, Ltd., a Cayman Islands-based software development company, and its CEO led an unregistered securities offering (The Sparkster Offering) of digital asset securities known as SPRK Tokens in 2018. 

When the CEO realized that he could draw attention and potential investors to the project by listing these tokens on ICO Promoter John Balina’s online spreadsheet and promoting them through social media sites, he quickly took action to reap benefits from this.

ICOs are often publicized and marketed via internet channels or other advertising techniques. An ICO issuer often publishes a “whitepaper” outlining the idea and advertising the ICO, frequently using technical terms. The issuer also announces the ICO on other websites, social media platforms, and other online platforms.

Nonetheless, Balina agreed to invest about 5 million dollars towards the Sparkster Offering and advertised it through various social media outlets such as Telegram, YouTube, and others. In return for his promotional efforts – he received a 30% bonus on all tokens purchased in the Sparkster Offering. But he never publicly disclosed his payment in exchange for his promotion.

Comments (No)

Leave a Reply