LBRY's $22 Million SEC Fine Reduced to $111K Due to Payment Concerns – What's Going On?
The US Securities and Exchange Commission (SEC) aims to reduce its $22 million punishment against decentralized content platform LBRY to around $111,000.
The commission submitted a request for amendments to the New Hampshire District Court on Friday, claiming that the platform is not likely to be able to shell out the million-dollar penalty.
Instead of the initial $22 million, the SEC has asked the court to impose a fine of $111,614, citing LBRY’s “lack of funds and near-defunct status.”
“The Commission acknowledges LBRY’s representations that it is defunct, ceasing operations, and without the funds to pay a larger fine, and recognizes that a defendant’s ability to pay is a factor when imposing a civil penalty."
The agency also asked LBRY to stop “conducting future unregistered offerings of crypto asset securities.”
The US regulator filed a civil lawsuit against LBRY in March 2021, alleging that the platform conducted an unregistered sale of its token LBRY Credits (LBC) and gained $22 million in the process.
In November last year, the SEC won the case and ruled that LBRY’s token LBC is deemed a security, subject to US securities laws.
At the time, the ruling said the blockchain publishing company did not have “a triable defense that it lacked fair notice” from the SEC.
“Because no reasonable trier of fact could reject the SEC’s contention that LBRY offered LBC as a security, and LBRY does not have a triable defense that it lacked fair notice, the SEC is entitled to judgment,” the ruling, written by U.S. District Judge Paul J. Barbado, said.
LBRY, on its side, had argued that the LBC token is not a security, calling it instead “a digital currency that is an essential component of the LBRY Blockchain.”
Last year, LBRY said in a
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