LBRY Defies Securities and Exchange Commission, Vows to Fight Back
LBRY, a blockchain-based file-sharing and payment network, has made the bold decision to challenge the United States Securities and Exchange Commission (SEC). This comes after a federal judge ruled in favor of the SEC, causing LBRY to reconsider its earlier plan to wind down operations.
LBRY Takes Legal Action
LBRY has announced that it filed a notice of appeal to the United States Court of Appeals for the First Circuit, seeking to challenge the final judgment entered on July 11th. The judge’s ruling favored the SEC, imposing a civil penalty on LBRY and prohibiting its participation in future unregistered crypto asset securities offerings.
“Defendant LBRY, Inc. now appeals to the United States Court of Appeals for the First Circuit this Court’s final judgment entered on the 11th of July, 2023.”
The SEC’s Allegations Against LBRY
In March 2021, the SEC sued LBRY Inc., accusing the network of selling its LBRY Credit token (LBC) as a security under the 1933 Securities Act. The US District Court for the District of New Hampshire ruled in favor of the SEC on November 7th, barring LBRY from offering unregistered crypto asset securities and imposing a civil penalty of $111,614.
Initially, the SEC sought a much higher penalty of $22 million but reconsidered due to LBRY’s financial limitations.
A Surprising Change of Events
Despite previously stating that the company was likely to cease operations, LBRY’s recent actions suggest a shift in strategy. The company’s founder and CEO, Jeremy Kauffman, expressed optimism about the future of the decentralized protocol despite the challenges faced by the company itself.
While LBRY had initially planned to wind down entirely, the recent move indicates a possible change in course. This decision also aligns with the recent successes of other cryptocurrency entities, such as Ripple and Grayscale, in their legal battles against the SEC.
Hot Take: LBRY’s Legal Battle Reflects the Crypto Industry’s Resilience and Determination
LBRY’s decision to fight back against the SEC showcases the crypto industry’s determination to overcome regulatory challenges. Despite facing legal setbacks, cryptocurrencies and blockchain technologies continue to thrive and evolve. The outcome of LBRY’s appeal could have significant implications for the industry as a whole, highlighting the importance of legal clarity and regulatory frameworks in the crypto space.
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