The United States District Court for the Western District of Texas recently ruled that Ian Balina, a well-known cryptocurrency opinion leader, violated securities laws when promoting and selling SPRK tokens. Based on the Howey test, $SPRK tokens were determined to be a security.
The court’s decision supported the position of the U.S. Securities and Exchange Commission (SEC), confirming that Ballina violated U.S. securities laws by offering and selling SPRK tokens without registration. In a complaint filed on September 19, 2022, the SEC stated that Ballina purchased $5 million worth of SPRK tokens from Sparkster Ltd. in May 2018, and subsequently organized an investment team of approximately 68 people to promote and sell these tokens to them without registering with the SEC as required by federal securities regulations.