LBRY, the blockchain-powered file-sharing and payment network, has chosen to reignite its legal dispute with the United States federal regulator. This decision comes after a previous defeat in November.
On September 7th, The Blockchain firm, LBRY took a significant step by officially filing an appeal with the United States Court of Appeals for the First Circuit. Their objective is to contest the final judgment made on July 11th.
This judgment imposed two key requirements on LBRY. Firstly, it mandated them to pay a civil penalty. Secondly, it prohibited their future participation in unregistered offerings of cryptocurrency securities. The appeal document states, “LBRY, Inc. as the defendant now appeals the final judgment issued on July 11, 2023, by this Court.”
In March 2021, the SEC initiated a lawsuit against LBRY, Inc., alleging that its LBRY Credit token (LBC) qualified as a security under the 1933 Securities Act.
On November 7th, the U.S. District Court for the District of New Hampshire granted the SEC’s summary judgment against LBRY, barring the platform from offering “unregistered cryptocurrency securities” and imposing a $111,614 civil penalty.
Blockchain Firm LBRY Challenges SEC Decision Despite Financial Constraints
The regulator had originally sought a $22 million penalty but changed course when it became apparent that the defunct company could not afford it. In January, Jeremy Kauffman, LBRY’s founder and CEO, told Cointelegraph, “LBRY as a company is almost certainly defunct.”
Following the July judgment, the company seemed to accept this outcome, stating on social media, “In accordance with the court’s order and our commitments, we anticipate winding down LBRY Inc. over the next few months.”
However, LBRY’s recent actions suggest a potential change in direction. This comes amid several notable victories within the cryptocurrency industry against federal regulators, including Ripple and Grayscale.
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