SEC Drops Lawsuit Against BitClout Founder Nader Al-Naji

The US Securities and Exchange Commission (SEC) has dropped its lawsuit against BitClout's founder Nader Al-Naji, bringing an end to a long-running civil enforcement action. The decision was made after the SEC and Al-Naji agreed to close the case in a joint stipulation filed with the U.S. District Court for the Southern District of New York.

The lawsuit had been filed in July 2024, accusing Al-Naji of violating securities laws through BitClout, a crypto-based social network project that later became associated with the decentralized social blockchain DeSo. The SEC claimed that Al-Naji raised approximately $257 million from the sale of BitClout's native token, BTCLT, and used some of the funds for personal expenses.

As part of the agreement to close the case, Al-Naji and several relief defendants waived any claims for attorney's fees or damages related to the investigation or litigation. The SEC had also charged Al-Naji with wire fraud and selling unregistered securities.