<\/p>\n
SEC Commissioner Hester Peirce is once again dissenting from a crypto-related decision made by the agency she helps lead.<\/p>\n
Peirce, who has historically spoken out about her support for a spot bitcoin ETF and other facets of the crypto space, did not agree with the Securities and Exchange Commission\u2019s decision to bring a case against LBRY, she said in a Friday statement.\u00a0<\/p>\n
The SEC filed a lawsuit against the blockchain-based file-sharing network in March 2021 \u2014 accusing it of offering LBRY Credit tokens (LBC) without registering them as securities.<\/p>\n
LBRY CEO Jeremy Kauffman previously expressed concern this decision could potentially endanger the entire US crypto industry, as it would establish a precedent that could classify \u201calmost every cryptocurrency\u201d as security.<\/p>\n
\u201cThe commission has brought many troubling crypto enforcement actions, but the LBRY\u2026case has especially unsettled me,\u201d she noted.<\/p>\n
Read more:<\/strong> SEC Crypto Enforcements on Track to Eclipse 2022<\/a><\/p>\n LBRY\u2019s approach was \u201cmore conservative\u201d than those other projects took, Pierce said, making the SEC\u2019s action against the company \u201cespecially puzzling.\u201d Monetary remedies sought by the SEC \u2014 originally amounting to $44 million \u2014 were \u201centirely out of proportion to any harm,\u201d she added.<\/p>\n LBRY said last week it would cease operations<\/a>, citing its legal defeat to the SEC.\u00a0\u00a0<\/p>\n \u201cAre investors and the market really better off now after the Commission\u2019s litigation contributed to the demise of a company that had built a functioning blockchain with a real-world application running on top of it?\u201d Peirce added in the statement<\/a>. \u201cThis case illustrates the arbitrariness and real-life consequences of the Commission\u2019s misguided enforcement-driven approach to crypto.\u201d<\/p>\n A spokesperson for the SEC did not immediately return a request for comment.\u00a0<\/p>\n This isn\u2019t the first time Peirce has spoken out against SEC opposition to the crypto segment. She said during a discussion with Florida International University law students in March that enforcement should only come after regulations<\/a> are put in place.<\/p>\n Those comments came before the SEC sued Coinbase and Binance in the same week<\/a> in June. Those cases, which both involve alleged securities violations, are ongoing. The crypto exchanges have denied wrongdoing.\u00a0<\/p>\n Peirce, in an interview<\/a> with CNBC Monday, said she has believed for five years that the regulator should approve a spot bitcoin ETF \u2014 noting \u201cthe logic for why we haven\u2019t [approved one] has always mystified me.\u201d<\/p>\n The SEC commissioner put forward a safe harbor proposal<\/a> in April 2021 that would give developers a grace period to experiment with decentralized networks while being exempted from certain federal securities laws.<\/p>\n \u201cOur disproportionate reaction in this case will dissuade people from experimenting with blockchain technology, which LBRY aptly describes as \u2018technology that enables dissent,\u2019\u201d Peirce said Friday. \u201cA government of a free people should welcome dissent and the technologies that enable it.\u201d<\/p>\n Don\u2019t miss the next big story \u2013 join our\u00a0free daily newsletter<\/a>.<\/strong><\/p>\n
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