SEC Dismisses Fraud Suit Against BitClout Founder

The U.S. Securities and Exchange Commission has dismissed its civil fraud lawsuit against Nader AlNaji, the founder of the blockchain-based social media platform BitClout, in a joint agreement filed with the U.S. District Court for the Southern District of New York in March 2025. The action ends a legal battle that accused AlNaji of raising more than $257 million through unregistered sales of the platform's native token, BTCLT, while making misleading statements to investors.

The SEC's original complaint, filed in July 2024, alleged that AlNaji falsely told investors the funds would not be used to pay team members or for personal expenses. Regulators claimed he spent over $7 million on items such as rent for a Beverly Hills mansion and cash gifts to family members. The suit also accused AlNaji of misrepresenting BitClout as fully decentralized, despite operating it under the pseudonym Diamondhands and exerting significant control behind the scenes. Named as relief defendants were AlNaji's wife, Buse Desticioğlu AlNaji; his mother, Joumana Bahouth AlNaji; and several affiliated entities, including Intangible Holdings LLC, Firestorm Media LLC, Viridian City LLC, and the DeSo...