At press time, LBRY Token had plummeted to $0.009298 from its peak of $0.01235 on July 11. This sharp decline followed a ruling that LBRY Inc. had violated US securities laws. As a result, the company has announced that it is shutting down.
The LBRY Credits (LBC) took a hit of 24% in the early hours of the day due to the Federal Judge’s judgment that LBRY, Inc, the corporation behind the LBRY protocol, has breached US securities laws. The SEC sued LBRY in March 2021 for offering unregistered securities.
The court’s final decision declared that LBRY, Inc is forbidden from selling unregistered securities unless it registers with the US Securities and Exchange Commission (SEC). Additionally, the firm has 30 days to pay a fine of $111,614.
Following the ruling, the decentralized content-sharing project LBRY Inc. quickly declared that it is commencing the process of winding down completely.
The SEC never called for the closure of the project, even in their initial complaint, despite the company’s announcement of its closure. The regulator only sought to prevent unregistered securities offerings of any kind and the return of “ill-gotten” profits from those activities, with civil penalties.
In November of last year, Judge Paul J. Barbadoro of the U.S. District Court of New Hampshire ruled against LBRY Inc., finding that no reasonable trier of fact could refute the SEC’s claims. Consequently, LBRY Inc. admitted defeat.
However, LBRY Inc. won an appeal on whether secondary market sales of the LBC tokens should be included in an injunction the US SEC is requesting the court to approve.
After yesterday’s ruling, the company’s CEO, Jeremy Kauffman, tweeted that “neither the SEC nor the federal judge himself can tell me what the law allows and doesn’t allow,” adding that “all I’ve ever wanted to do is follow the law.”
