SEC Withdraws BitClout Founder Lawsuit and Bars Refiling, Signaling Shift in Crypto Regulation

Gate News Report, March 16 — The U.S. Securities and Exchange Commission (SEC) has officially dismissed the lawsuit against Nader Al-Naji and confirmed that the related charges will not be refiled in the future. This decision ends a nearly two-year legal dispute and is seen as a significant signal of changing regulatory attitudes toward cryptocurrencies in the United States.

According to a joint dismissal agreement filed with the U.S. District Court for the Southern District of New York, the SEC stated that the decision to dismiss was partly based on progress in its cryptocurrency task force’s research on regulatory frameworks and a reassessment of the case’s evidence record. The task force is responsible for developing new regulations for digital assets and is expected to establish clearer regulatory directions in the future. However, the SEC emphasized that this dismissal is an isolated case and does not imply that other enforcement actions against cryptocurrencies will follow the same stance.

The case originally stemmed from charges filed in July 2024. The SEC alleged that Al-Naji raised over $257 million through the issuance of the BitClout platform token BTCLT and told investors that the funds would not be used for team salaries. The agency later accused him of diverting about $7 million for personal expenses, including paying for a Beverly Hills mansion and transferring funds to family members. Additionally, the SEC argued that BitClout’s operational structure was not fully decentralized and that Al-Naji maintained control behind the scenes.

Al-Naji was previously a Google engineer, the founder of the stablecoin project Basis, and creator of the DeSo blockchain network. His launched project, BitClout, went live in 2021, focusing on a blockchain-based social media ecosystem.

The settlement agreement also stipulates that Al-Naji waives his right to seek legal fees from the SEC. Meanwhile, the U.S. Department of Justice previously dropped another telecom fraud charge against him in February 2025, which also cannot be refiled. Al-Naji stated on social media that the case being dismissed indicates that the charges lacked sufficient grounds.

Market analysts note that during the Trump administration, U.S. regulators have been adjusting their approach to enforcement in the crypto industry. Some cases involving digital asset projects have been withdrawn or re-evaluated, leading the industry to closely watch future regulatory policies.