•LBRY Inc. will likely be dead in the near future, but the company’s mission will continue on, according to a Twitter update.
• The U.S. Securities and Exchange Commission (SEC) took LBRY to court in March 2021 over its LBRY Credit (LBC) tokens, alleging that the firm had been conducting unregistered securities offerings since 2016.
• The SEC won that battle last month on Nov. 7, after a judge deemed the tokens to be securities in a major blow to the industry.
- In response to continued SEC negotiations this week, LBRY suggested that it offered the agency “everything we have,” but this proposal was still rejected due to stipulations on future sales of LBC.
SEC scores another win
Last month, in a major victory for the Securities and Exchange Commission (SEC), a federal judge ruled that LBRY’s LBC tokens are securities. This ruling could have far-reaching implications for other firms in the cryptocurrency industry that have been conducting unregistered securities offerings, including the popular exchange Coinbase.
In response to the SEC’s negotiations this week, LBRY proposed that it offered the agency “everything we have,” but this proposal was still rejected due to stipulations on future sales of LBC. The fate of LBRY now looks uncertain, with the company likely to be dead in the near future. However, the mission of LBRY will continue on, as the team plans to shift its focus to developing blockchain-based applications.
The Significance of the SEC’s Victory Against LBRY
This is a significant victory for the SEC, which has been warning investors about the risks of investing in unregistered securities for years. The agency has taken enforcement action against several firms in the cryptocurrency space, including Ripple, Telegram, and Kik.
The SEC’s victory against LBRY is also noteworthy because it is one of the first times that a court has upheld the agency’s position that digital assets can be considered securities. This ruling could have major implications for other firms in the space that have been conducting unregistered securities offerings, including popular exchange Coinbase.
The Fate of LBRY Looks Uncertain
In response to the SEC’s negotiations this week, LBRY proposed that it offered the agency “everything we have,” but this proposal was still rejected due to stipulations on future sales of LBC. As a result of this rejection, the fate of LBRY now looks uncertain.
However, even if LBRY does not survive as a company, its mission will continue on through its team’s plans to shift their focus to developing blockchain-based applications. So while this may be the end of one chapter for LBRY, it is likely just the beginning for its team.
Implications for Other Companies in the Space
The SEC’s victory against LBRY could have major implications for other companies in the cryptocurrency industry that have been conducting unregistered securities offerings. These companies include popular exchange Coinbase, which is currently facing a class action lawsuit alleging that it sold unregistered securities in its Coinbase Commerce product. If Coinbase is found to have sold unregistered securities, it could be subject to sizable fines and penalties from the SEC. The outcome of this case will likely have major implications for other companies in the space and could shape regulatory action against cryptocurrencies going forward.
While it is still too early to tell what exactly will happen next, one thing is certain: The SEC’s victory against LBRY is a big win for investors and underscores the importance of compliance with federal securities laws. The SEC’s recent victory against LBRC could set a precedent for how digital assets are regulated in the United States. This ruling could mean big trouble for firms who have been conducting illegal unregistered securities offerings , particularly popular cryptocurrency exchange Coinbase. Only time will tell how this case will impact the cryptocurrency industry as a whole.
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