As a seasoned analyst with over two decades of experience in the cryptocurrency market, I have witnessed numerous legal battles between regulators and blockchain projects. In this instance, the Tron ecosystem’s victory against the SEC is not only significant but also a testament to their resilience and determination.
In a legal turn of events, the financial regulatory body of the U.S., the Securities and Exchange Commission (SEC), has faced a setback as a New York judge declined their request to speed up the court process in the ongoing securities fraud case involving Tron Foundation and its founder Sun. This decision came after the recent acquisition of additional Ethereum by Tron.
Tron Turns the Table on SEC
Lately, the regulatory body has put forward a petition for a pre-trial meeting concerning the Tron securities case. Additionally, they requested authorization to file further replies in their legal action against the Tron Foundation, its founder Justin Sun, the BitTorrent Foundation, and Rainberry Inc.
As a crypto investor, I’ve come to understand that the SEC has raised objections against certain defendants. They’ve presented novel legal viewpoints concerning the ‘common enterprise’ aspect of the Howey Test. In simpler terms, they believe these defendants have misapplied this element of the test in relation to the sales of TRX and BTT. The third prong of the Howey Test is particularly relevant here, as it helps differentiate investment contracts under U.S. securities laws.
According to the regulator, the Tron Foundation is believed to have broken the law by presenting their defense point after already filing their motion to dismiss the case, which can be seen as an attempt to evade the initial argument. In response, the legal team for Tron submitted a formal letter to Judge Edgardo Ramos of the Southern District of New York (SDNY).
1. The accusers claimed the U.S. regulatory body was trying to stir up a debate unnecessarily. Additionally, these legal representatives petitioned the court to deny the Commission’s request for a pretrial meeting.
In their response, Tron’s legal team contends that the SEC’s application to submit an extra document wrongly misrepresents and overlooks the defendants’ argument concerning Howey’s third prong in this particular case, despite it being emphasized in bold and italics. The latest update indicates that Judge Ramos has backed the lawyers’ stance and swiftly rejected the SEC’s request.
As a researcher, I can rephrase that statement as follows: “In accordance with the defendants’ admission that they do not dispute the ‘common enterprise’ aspect of the Howey test, the court’s decision to either dismiss or allow the filing of an additional response to the late argument in this case was denied by the New York judge.”
SEC Accused of Overreaching
Unfortunately, this presents a significant hurdle for the regulator in the Tron securities lawsuit. The Tron Foundation argues that the SEC is overstepping its bounds by attempting to apply U.S. securities law to transactions occurring outside of the country. In response, the regulator has pointed out that Tron’s founder frequently traveled within the United States during the relevant time period.
As the journeys were tied to Tron and its associated parties, the Securities and Exchange Commission (SEC) contended that this connection provides enough reason for U.S. courts to handle the case.
Despite ongoing legal issues, the Tron Network has seen a surge in optimistic feedback based on significant improvements in key performance indicators. By the end of July, the number of daily active addresses on the Tron network had climbed from approximately 1.59 million in January to around 2.42 million.
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2024-08-20 12:09