Court Rules Influencer Ian Balina Violated Securities Laws Promoting SPRK Tokens

Fraud SEC
Last updated:
Author
Author
Hongji Feng
About Author

Hongji is a crypto and tech reporter. He graduated from Northwestern University's Medill School of Journalism with a Bachelor's and a Master's. He has previously interned at HTX (Huobi Global),...

Last updated:
Why Trust Cryptonews
Cryptonews has covered the cryptocurrency industry topics since 2017, aiming to provide informative insights to our readers. Our journalists and analysts have extensive experience in market analysis and blockchain technologies. We strive to maintain high editorial standards, focusing on factual accuracy and balanced reporting across all areas - from cryptocurrencies and blockchain projects to industry events, products, and technological developments. Our ongoing presence in the industry reflects our commitment to delivering relevant information in the evolving world of digital assets. Read more about Cryptonews

A U.S. district court has found crypto influencer Ian Balina guilty of violating U.S. securities laws.

According to recent court filings, Judge David Alan Ezra ruled that Balina was guilty promoting and selling SPRK tokens without proper disclosure. the judge ruled that SPRK tokens met the criteria of the Howey Test, making them securities.

Unlawful Promotion without Proper Disclosure

Balina faced charges in September 2022 due to his participation in the unregistered initial coin offering (ICO) of SPRK tokens. The Securities and Exchange Commission (SEC) contended that these tokens necessitated appropriate registration and disclosure.

The court found that Ian Balina engaged in promoting and selling SPRK tokens through various social media platforms, including YouTube and Telegram.

Balina did not disclose that he was receiving compensation of a 30% bonus for these promotions, which the court determined was a violation of Section 17(b) of the Securities Act.

Balina organized an investment pool where he offered SPRK tokens to investors. The SEC highlighted that he failed to properly disclose his financial interest in the tokens he received from Sparkster, the company behind SPRK.

The SEC stated that the token offering raised approximately $30 million from nearly 4,000 investors located abroad and in the U.S. from April to July 2018.

Ian Balina’s Response to SEC’s Charges

Balina’s website posted a response

to the SEC’s “baseless” charges, saying, “This is the first time a private pre-sale purchase of a digital asset token has been accused of being ‘compensation’ in exchange for publicity.”

“The Security and Exchange (SEC) Enforcement Division’s proposed charges against Mr. Balina are an unfounded effort based upon multiple misconceptions of fact and law, enumerated below,” the post reads.

The response asserted that Balina did not receive any compensation, and there is no evidence to support such allegations. It also claimed that he did not profit from his purchase, suggesting that he might be a victim of fraud by the Sparkster team, similar to other investors.

More Articles

Cryptonews Reports
Russian Court Extends Detention of Pilot Arrested for Sending Crypto to Ukraine Military
Tim Alper
Tim Alper
2025-02-13 23:30:00
Price Analysis
Hyperliquid Defies the Crypto Downtrend – Could HYPE Overtake Solana?
Michael Davis
Michael Davis
2025-02-13 23:13:56
Crypto News in numbers
editors
Authors List + 66 More
2M+
Active Monthly Users Around the World
250+
Guides and Reviews Articles
8
Years on the Market
70
International Team Authors