Blockchain Company LBRY Shuts Down After Legal Battle With SEC
21 Octubre 2023 - 2:10PM
NEWSBTC
LBRY Inc., a cryptocurrency platform, announced its closure due to
a court failure against the Securities and Exchange Commission
(SEC). The SEC charged LBRY with making an unregistered securities
offering by selling its native LBC tokens. The fallout from this
legal fight has prompted worries about unequal access to justice
and regulatory overreach in the crypto business, which has
disproportionately impacted smaller startups with minimal financial
resources. LBRY Inc. reported that the company was compelled to
discontinue operations because of obligations owed to the SEC,
legal team, and private creditors totaling several million dollars.
LBRY Inc. is winding down. The LBRY network is unaffected. Odysee
and other assets will undergo a legal process to satisfy debts, but
Odysee has a bright future ahead. Thank you to everyone who fought
with us for online freedom. A final goodbye post is in the first
reply. — LBRY 🚀 (@LBRYcom) October 19, 2023 LBRY’s Financial
Struggles The SEC first sought a $22 million penalties, which was
later lowered to $111,614. This lowered fine was a major financial
blow for LBRY, making it impossible for the company to continue
operations. Related Reading: Bulls Thrust Solana To $25 – What
Traders Should Expect Next The scenario exemplifies the
difficulties that crypto businesses can face when they are pursued
by regulatory agencies, particularly smaller startups with minimal
financial resources. The SEC has been accused of regulatory
overreach in pursuing LBRY, with critics suggesting that the agency
should focus on big issues in the crypto business rather than minor
instances of securities noncompliance. However, this case
highlights the SEC’s ability to control the cryptocurrency market
through enforcement proceedings. Ripple’s Contrasting Legal Victory
The downfall of LBRY contrasts sharply with Ripple’s recent court
success in its ongoing struggle with the SEC. Ripple acquired
funding from a multibillion-dollar corporation, allowing it to
continue its legal battle. Crypto total market cap currently at
$1.10 trillion. Chart: TradingView.com While LBRY Inc.’s controlled
operations are ending, the LBRY blockchain, an open-source
initiative, may continue to exist if sufficient user engagement is
obtained. However, the business stated that decentralization may
only succeed if active development and user participation are
present. With millions of registered users and a large volume of
published material, the LBRY blockchain acted as a decentralized
file-sharing network. Odysee, a decentralized social networking
platform built on the LBRY blockchain, has a substantial user base.
However, its future is now in doubt. In a broader sense, the legal
disputes in the crypto business are altering the securities law
landscape. Both LBRY and Ripple have been accused with selling
unregistered securities, but their outcomes have set developing
precedents. Related Reading: Stacks (STX) Rockets 26% Higher In A
Single Week: The Factors At Play These results have prompted
concerns about the SEC’s capacity to win legal battles against
other crypto businesses. As LBRY succumbs to regulatory pressure,
it represents the obstacles encountered by smaller crypto
businesses, as well as the broader issue of unequal access to
justice in the cryptocurrency industry’s growing regulatory
context. Featured image from Conseils Crypto
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