The U.S. Securities and Exchange Commission to slash $22 million in monetary penalties issued against crypto company LBRY following a March 2021 regulatory lawsuit.
In November, a court in New Hampshire ruled against LBRY and backed the SEC’s claims. The watchdog sued LBRY for $22 million in March 2021 over its LCB tokens, alleging that the crypto startup violated U.S. rules by not registering its financial offering with the commission.
LBRY is a blockchain-based filesharing and payment network that powers decentralized platforms with a primary focus on social and video platforms. The startup denied any rule-breaking and entered a two-year-long legal battle with the commission.
LBRY argued that the commission’s fine was excessive, citing Kik’s $100 million token offering and the subsequent $5 million settlement after unregistered securities claims were levied.
The regulatory scene in the U.S. soured significantly in the months that followed after the LBRY lawsuit as federal and state agencies unleashed a sizzling crackdown on crypto businesses in America.
On May 12, the SEC cited LBRY’s “lack of funds and near-defunct status” and filed documents to reduce its fine to $111,614.
SEC Spearheads America’s Crypto Crackdown
The commission has rattled crypto’s ecosystem with several enforcement actions since the case against LBRY. Ripple, another crypto player, has an unsettled legal showdown with the watchdog over the sale of $1.3 billion in XRP coins.
Entities like Coinbase have looked towards off-shore jurisdictions amid America’s stifling crypto regulatory landscape. Still, industry juggernauts like COINBASE CEO Brian Armstrong remain confident of doing business in the U.S. as players push for clearer crypto rules.
