Democratic Party members jointly send a letter to the US SEC, requesting the continuation of the Sun Yuchen case review

Several Democratic members of the U.S. House Financial Services Committee sent a letter to SEC Chairman Paul Atkins on 1/15, requesting an explanation for the SEC’s retreat in enforcement in multiple cryptocurrency cases. The most notable case involves Tron founder Justin Sun( and allegations of fraud and securities law violations. The letter directly points out that the SEC originally had a case with “comprehensive evidence and a very high chance of success,” but suddenly asked the court to suspend proceedings and engage in settlement negotiations in 2025. The letter questions whether this turn of events is related to Sun’s cryptocurrency investments with the Trump family, and calls for continued prosecution.

From Token Issuance and Wash Trading to Celebrity Endorsements, SEC Accuses Sun of Systematic Violations Since 2017

Since 2017, Sun has led the issuance of TRX and BTT tokens without registration and sold them to the public, which is equivalent to unregistered securities sales. He also instructed employees to buy and sell among accounts under his control, creating large volumes of fake transactions to simulate market activity, and used this to sell approximately $31 million worth of tokens.

The SEC also accuses him of orchestrating celebrity promotional campaigns in 2021, hiring celebrities and influencers to promote tokens without disclosing paid advertising, and even claiming to require disclosure of paid promotions while actually being aware of and not disclosing such payments. In March 2023, the SEC formally sued Sun and related companies, alleging years of unregistered securities issuance, market manipulation, and undisclosed paid promotions.

Court Has Allowed Continued Litigation, Political Factors Become Key Variables

The above allegations have received some support from the courts. The Southern District of New York court considers TRX may be a security and in 2024 allowed investors to continue suing Tron and Sun. Some celebrities involved in promotion have already settled with the SEC and paid fines in 2023, indicating the case is not weak in evidence.

However, during the proceedings, Sun invested heavily in the Trump family-supported World Liberty Financial at the end of 2024 and early 2025, investing at least $75 million and serving as an advisor. Meanwhile, the Trump administration’s more friendly stance toward the crypto industry adds variables to future regulatory directions.

Democratic Lawmakers Question Sun’s Case, Demand SEC Explanation

In the letter dated 1/15, three Democratic members of the House Financial Services Committee, including Representatives Maxine Waters, Brad Sherman, and Sean Casten, questioned the case against Sun. They pointed out that the case initially had “a high chance of success,” with complete investigations, some court-supported charges, and involved celebrities who had already admitted fault and paid fines. Yet, after Sun’s significant investments in Trump family crypto ventures, the SEC proactively asked the court to suspend proceedings.

The lawmakers stated plainly that such timing could lead the public to suspect political or financial motives influencing law enforcement, and demanded that the SEC either resume litigation and see it through or, if settling, set conditions “equivalent to winning the case” to protect investors’ rights.

Policy Shift After Trump Returns to Power, Democrats Focus on Crypto Conflict Risks

Since Trump returned to the White House, U.S. policy toward the crypto industry has noticeably shifted. Compared to the previous emphasis on regulation and enforcement, the new administration has more frequently signaled support for innovation and avoiding excessive regulation, making interactions between crypto and politics more closely intertwined. This has also led to a slowdown or change in direction in some ongoing judicial or regulatory cases.

Democrats continue to emphasize potential conflicts of interest between the Trump family and the crypto industry, calling for increased transparency and oversight. How these cases and policies will develop remains to be seen.

)US Lawmakers Demand SEC Clarify Sun’s Case, Triggering Concerns Over Trump WLF Money Flow, Shell Listings, and Chinese Capital(

This article about Democratic lawmakers jointly writing to the SEC demanding continued prosecution of Sun’s case first appeared on Chain News ABMedia.