The U.S. Securities and Exchange Commission (SEC) claims its token is subject to regulatory oversight. LBRY He emerged victorious in a battle with him in court.
Unlicensed Altcoin Project Decided to Sell Unregistered Securities
The court found that LBRY’s LBC token is an investment contract, even though the project in question did not sell it via an initial coin offering (ICO). The project started in 2016 with the goal of decentralization in publishing.
“LBRY is wrong on both facts and law,” the New Hampshire District Court said in its ruling. Judge Paul Barbadoro granted the SEC’s request for summary judgment, deciding the fate of the case, which began last March.
The decision came as a major blow to cryptocurrency issuers, many of whom argue that the SEC is following the path of “regulation through sanctions”. Like LBRY, many advocates of token issuance claim that the commission does not adequately warn crypto firms about how it will enforce its oversight.
This is a defense that SEC Chairman Gary Gensler has openly criticized in recent months and praised the SEC’s implementation of existing laws, and in particular the Howey Test, referring to a U.S. Supreme Court case regarding whether a transaction qualifies as an investment contract.
SEC’s Insufficient Information Argument Not Admitted
The court made the following statements regarding the issue:
“The evidence in the record is that LBRY’s LBC your altcoin reveals that the company is promoting the LBRY Network as an investment that will increase in value over time through its development.”
Referring to the Howey Test decision, the court said, “The SEC based its claim on a simple application of a venerable Supreme Court precedent that has been enforced by hundreds of federal courts across the country over 70 years. While this is the first time being used against a digital token issuer that has not performed an ICO, LBRY is not in a position to claim that it has not received fair notice that its conduct was unlawful.” said.
We lost. Sorry everyone.
— LBRY 🚀 (@LBRYcom) November 7, 2022
LBRY tweeted on the matter:
“We lost. We apologize to everyone.”
*Not investment advice.
For exclusive news, analytics and on-chain data Telegram our group, twitter our account and YouTube Follow our channel now! Moreover Android and iOS Start live price tracking right now by downloading our apps!