Introduction
The United States Securities and Exchange Commission (SEC) has revised the fine imposed on LBRY, a decentralized content sharing and publishing platform, from $11 million to $111,000. The SEC had initially imposed the fine on LBRY for allegedly selling unregistered securities.
Background
In March 2021, the SEC filed a complaint against LBRY, alleging that the company had sold unregistered securities in the form of its LBRY Credits (LBC) tokens. The SEC claimed that the LBC tokens were securities because they were sold to investors with the expectation of profit from the efforts of LBRY.
LBRY had argued that the LBC tokens were not securities and that they were used as a means of payment for accessing content on the platform. However, the SEC had maintained that the LBC tokens were securities and had imposed a fine of $11 million on LBRY.
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Revised Fine
LBRY had appealed the SEC’s decision and had requested a hearing before an administrative law judge. In May 2021, the SEC had granted LBRY’s request for a hearing.
On August 2, 2021, the SEC issued an order revising the fine imposed on LBRY from $11 million to $111,000. The SEC stated that it had considered LBRY’s financial condition and had reduced the fine accordingly.
Conclusion
The SEC’s decision to revise the fine imposed on LBRY is a positive development for the company. LBRY had argued that the LBC tokens were not securities and had maintained that it had not violated any securities laws. The revised fine is a recognition of LBRY’s financial condition and is a step towards resolving the dispute between LBRY and the SEC.
