U.S. courts have control It has backed the Securities and Exchange Commission (SEC) in a lawsuit against LBRY as it ruled that the blockchain network offered investors LBC tokens as securities.
—LBRY🚀 (@LBRYcom) November 7, 2022
In a Nov. 7 ruling, Judge Paul J. Barbadoro said evidence presented to the court showed that the network promoted LBC as an investment whose value would grow through the development of the company’s LBRY network. I have ruled that there is.
“By intertwining LBRY’s economic fortune with LBC’s commercial success, LBRY has made it clear to investors that it is committed to developing the network in a way that increases the value of LBC.”
The judge went on to say that LBRY cannot argue that it did not receive fair notice from the SEC because the commission took enforcement action based on Supreme Court precedent that has been widely applied for more than 70 years.
But Judge Barbadoro said this may be the first time the rule applies to “issuers of digital tokens who have not conducted an initial coin offering (ICO).”
Speaking about the development, network founder Jeremy Kaufman said, Said:
“The SEC v LBRY lawsuit establishes a precedent that threatens the entire U.S. cryptocurrency industry. Under this standard, almost all cryptocurrencies are securities, including Ethereum (ETH) and Dogecoin (DOGE). The future of cryptocurrencies now rests with a worse organization than the SEC: the US Congress.”
A statement from the network also echoed this view, saying that the language used in the ruling sets “a dangerous precedent for securing all US cryptocurrencies, including Ethereum.”
The SEC filed a lawsuit against LBRY in 2021, arguing that the company violated securities laws by failing to register with them and that LBC tokens are securities. The Gar Gensler-led committee is also embroiled in his legal battle with Ripple over the sale of XRP tokens.
On the other hand, the ruling had a negative impact on the price performance of LBC tokens. Data from CryptoSlate shows that the digital asset has fallen about 35% to $0.01322 since the ruling.