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A commissioner from the U.S. Securities and Exchange Commission (SEC) has released a statement dissenting against the agency\u2019s enforcement action against the blockchain-based file-sharing payment network LBRY.<\/p>\n
In a lengthy statement, SEC Commissioner Hester Peirce says<\/a> that the SEC\u2019s action against LBRY is \u201cpuzzling\u201d as there wasn\u2019t much evidence that the firm committed fraud.<\/p>\n \u201cThe Commission has brought many troubling crypto enforcement actions, but the LBRY, Inc. (\u2018LBRY\u2019) case has especially unsettled me\u2026 <\/em><\/p>\n This sad reality makes the Commission\u2019s decision to bring a case against LBRY especially puzzling. LBRY\u2019s approach was more conservative than the approach many other projects took. Here, the blockchain was up and running at the time most tokens were sold, and the Commission\u2019s complaint did not allege, and the court did not find, evidence of fraud.\u201d <\/em><\/p>\n According to Peirce, the SEC targeted LBRY \u2013 which she believes provided a real-world application \u2013 rather than pursue other digital asset projects that were obviously partaking in illegal activities. Furthermore, Peirce says that the SEC\u2019s enforcement actions against LBRY were too harsh.<\/p>\n \u201cWhy go after a company that sold a token for a functioning blockchain with an established use when we could have pursued plenty of other projects that were outright frauds and did not attempt to comply with the securities laws? To make matters worse, the Commission took an extremely hardline approach in this case. <\/em><\/p>\n For example, after winning on summary judgment, the Commission sought monetary remedies of $44 million and asserted that LBRY\u2019s offer to burn all tokens in its possession was not sufficient assurance that LBRY would not violate the registration provisions in the future. The Commission\u2019s requested remedies were entirely out of proportion to any harm.\u201d<\/em><\/p>\n The SEC originally filed a lawsuit against LBRY in 2021, alleging that the company sold crypto assets as unregistered securities. In November 2022, a judge ruled<\/a> in favor of the regulatory agency.<\/p>\n In May, the SEC showed a bit of mercy to LBRY, reducing<\/a> a $22 million fine to $111,000.<\/p>\n Don’t Miss a Beat \u2013 Subscribe<\/a> to get email alerts delivered directly to your inbox <\/span><\/em>
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