In a court filing submitted on February 26 to the U.S. District Court in Manhattan, both parties stated, “The Parties jointly move to stay this case to allow them to explore a potential resolution.” The filing further emphasized that all involved parties believe it is in their best interests to temporarily suspend proceedings while they negotiate a possible settlement.
The SEC and Sun have requested a 60-day period to submit a joint status report should the court grant the stay.
This move marks yet another enforcement action in the crypto sector that the SEC has halted under the Trump administration. The regulator has also sought to stay or dismiss cases against major crypto exchanges Binance and Coinbase, among others.
During his campaign, U.S. President Donald Trump pledged to ease regulatory scrutiny on the digital asset industry, vowing to position the country as the global hub for cryptocurrency. Reports indicate that the SEC has prioritized pausing cases with imminent deadlines, raising the possibility that lawsuits against crypto firms Kraken and Ripple—scheduled for court proceedings in late March and mid-April, respectively—could also be stayed.
The SEC originally filed a lawsuit against Sun and his companies in March 2023. The defendants include the entity behind the Layer-1 blockchain Tron, the Tron Foundation, as well as the BitTorrent Foundation and its San Francisco-based parent company, Rainberry Inc.
The agency accused Sun and his firms of selling unregistered securities through the issuance of Tron (TRX) and BitTorrent (BTT) tokens and engaging in “manipulative wash trading” on secondary markets.
Sun previously sought to have the lawsuit dismissed, arguing that the SEC lacked jurisdiction since the token sales were “predominantly foreign conduct.” However, the SEC countered that Sun’s extensive travel within the U.S. established its authority to pursue the case.
Notably, Sun is the largest investor and an advisor to Trump’s crypto platform, World Liberty Financial. He has invested a total of $75 million in the platform’s native token across two significant buy-ins. His initial investment of $30 million in November secured him the position of the platform’s largest investor, followed by an additional $45 million investment last month.
