New Hampshire Court Sides With SEC in Lawsuit Against LBRY, Project’s Team Says Loss Sets a ‘Dangerous Precedent’

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The US Securities and Exchange Commission (SEC) has won a court case against blockchain-powered publishing platform LBRY. Pursuant to the New Hampshire District Court ruling, Judge Paul Barbadoro agreed with the SEC that the project’s original asset, LBC, was to be considered an investment contract or a transferable share representing a certificate of interest. On Twitter, LBRY said the language that influenced the court’s decision “sets an extraordinarily dangerous precedent.”

US Regulator Wins Judgment Against Decentralized Blockchain Platform LBRY

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According to court documentsThe US regulatory watchdog, the Securities and Exchange Commission (SEC), has won a case where it argued that LBRY sold an unregistered security that violated Section 5 of the Securities Act of 1933. In addition, the SEC seeks injunctive relief from the alleged proceeds of LBRY’s LBC tokens.

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Despite LBRY’s argument that a blockchain token was not a security, but an essential component of the LBRY blockchain network, Judge Paul Barbadoro approved the SEC’s motion for summary judgment. The approved summary judgment of the New Hampshire District Court emphasizes:

LBRY is misunderstood both about the facts and the law.

Unlike a myriad of other crypto projects, LBRY did not have an Initial Coin Offering (ICO), and LBRY Logic That the language used in the SEC’s decision and summary judgment set an “extraordinarily dangerous precedent.”

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The dangerous precedent means that US regulators could “make every cryptocurrency in the US a security, including Ethereum,” LBRY said. LBRY Team exposure That they plan to heal by licking their “wounds a bit”, but added, “We are not giving up.”

The LBRY case has many people discussing whether other decentralized crypto assets will be targeted by a US regulator. During the second week of September, SEC Chairman Gary Gensler said he wanted the SEC to strengthen crypto compliance.

The regulator also stated that “out of the approximately 10,000 tokens in the crypto market,” they believe “the majority are securities.” In mid-July, Gensler reported that the SEC was looking at “tokens, stablecoins and non-stablecoins” as far as regulatory clarity is concerned.

What do you think about the US Securities and Exchange Commission prevailing in a court case against blockchain publishing platform LBRY? Let us know what you think about this topic in the comment section below.

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