- The U.S. Securities and Exchange Commission has charged Ian Balina, CEO of Token Metrics
- Balina is accused of conducting an initial coin offering for the Sparkster (SPRK) token in 2018.
- The watchdog insists that the $30 million ICO was unregistered and in violation of the Securities Acts.
- SEC prosecutors have targeted several crypto participants and projects over allegedly illegal operations.
The U.S. Securities and Exchange Commission filed charges against crypto influencer and Token Metrics CEO Ian Balina over an initial coin offering (ICO) for the Sparkster (SPRK) token in 2018.
SEC prosecutors filed that Balina’s and Sparkster’s activities at the time violated securities law, per Monday’s filing.
Balina served as a crypto promoter for the SPRK token between April and July 2018. SPRK was a token launched by software development startup Sparker, LTD domiciled in the Cayman Islands.
Sparkerster offered its SPRK token to investors in the form of an initial coin offering (ICO). An ICO as the name suggests involves offering a fixed amount of tokens for sale at the early stages of a project or company.
Crypto Investors can scoop up these tokens in the same way that traditional investors buy company stocks during an initial public offering (IPO). Proceeds from an ICO are usually deployed towards developing the company’s blockchain network or project.
In turn, the buyers receive tokens as a sort of stake in the project. These tokens are then locked up for a period of time before investors can decide to sell, usually for a higher price than the ICO price.
The SPRK token raised an estimated $30 million from some 4000 investors in the U.S. and around the world. Balina who shilled the tokens via his social media accounts and promoted the ICO sale also signed a contract with Sparkerter, per the SEC’s filing
The crypto influencer allegedly invested about $5 million in the software startup and received a 30% bonus on SPRK tokens. Balina then offered some of the SPRK tokens he received to a pool of around 50 investors including U.S. residents.
SEC prosecutors charged both Sparkster and Ian Balina for selling unregistered securities as neither entity filed an application with the commission. The watchdog filed that the actions of Ian Balina and Sparkster during the SPRK ICO violated several sections of established securities laws.
Ian Balina Joins Forsage On SEC Crypto List
The charges against Balina and Sparkster over the SPRK ICO join several charges levied by the SEC against illicit digital asset activities. SEC prosecutors also charged 11 individuals in connection to the $300 million Forsage crypto debacle.