Tron Foundation has escalated as Tron seeks dismissal of the lawsuit in a New York federal court
The ongoing legal battle between the U.S. Securities and Exchange Commission (SEC) and the Tron Foundation has escalated as Tron seeks dismissal of the lawsuit in a New York federal court. The dispute centers on allegations of unregistered securities offerings involving Tron (TRX) and BitTorrent (BTT) tokens, with the Tron Foundation vehemently contesting the SEC’s jurisdiction over what it deems as “predominantly foreign conduct.”
In a bold move, the Tron Foundation argued that the SEC’s attempt to apply U.S. securities laws to activities conducted primarily outside the United States constitutes an overreach. The Foundation’s dismissal motion, filed on March 28, highlights the regulator’s lack of jurisdiction over “foreign digital asset offerings to foreign purchasers on global platforms.” This stance challenges the SEC’s authority to regulate transactions that occur beyond U.S. borders.
The crux of Tron’s defense lies in its assertion that the tokens in question were sold exclusively overseas, with deliberate measures taken to avoid the U.S. market. According to Tron, the SEC’s lawsuit fails to establish that the tokens were initially offered or sold to any U.S. residents. This argument underscores the Foundation’s contention that the SEC’s jurisdiction should not extend to transactions conducted outside U.S. borders and involving foreign purchasers.
The legal saga dates back to March 2023 when the SEC filed a lawsuit naming Justin Sun, the Tron Foundation, the BitTorrent Foundation, and Rainberry, BitTorrent’s San Francisco-based parent company acquired by Tron in 2018. The SEC alleged that the sale of TRX and BTT tokens constituted unregistered securities offerings, sparking a contentious legal battle that has since captured widespread attention within the crypto community.
Tron’s motion to dismiss marks a pivotal moment in the case, with the Foundation’s legal strategy challenging the SEC’s interpretation of its jurisdictional authority. By pushing back against the SEC’s claims, Tron aims to defend its position and reputation while advocating for clearer regulatory boundaries in the rapidly evolving cryptocurrency landscape.
As the legal proceedings unfold, the outcome of Tron’s dismissal motion will have far-reaching implications for the cryptocurrency industry at large. The case serves as a litmus test for the regulatory framework governing digital asset offerings and highlights the need for greater clarity and consistency in regulatory oversight. Ultimately, the resolution of the dispute between Tron and the SEC will shape the future trajectory of regulatory compliance and innovation within the crypto ecosystem.