In a bittersweet goodbye, LBRY, the blockchain company renowned for championing online freedom, has published its final message to the crypto world. Citing "several million dollars" of crippling debts, LBRY declared that this would be its last post before LBRY shutting down. The company had been tangled in a legal battle with the U.S. Securities and Exchange Commission (SEC), ultimately losing to the U.S. federal government.
The LBRY vs. SEC battle started in March 2021 when SEC alleged that starting in 2016, LBRY “offered and sold millions of dollars’ worth of unregistered securities to investors” through its LBC token system. LBRY explained that the proceeds were going to be used to “fund its business and build its project”. However, the SEC argued that LBC tokens were “offered and sold as investment contracts and, therefore, securities”, with LBC token buyers expecting “a return on their investment based on the entrepreneurial or managerial efforts of LBRY.”
LBRY fought back the case but ultimately lost in November last year, with the judge issuing a $22 million fine. LBRY's financial challenges were the weight that dragged it down further to the bottom. And so, the SEC reduced the initially sought hefty $22 million in penalties to $111,000, recognizing the firm's inability to pay. LBRY had initially announced its intention to say goodbye in July after a final judgement in favour of the SEC on July 11.
This has still proved too much for LBRY to bear, however, it was announced that its seven-year stay in the crypto world is coming to an end as the court ordered LBRY to be permanently stopped from violating Section 5 of the Securities Act.
In a surprising twist, the community celebrated when LBRY filed a notice of appeal against the SEC in September. However, the recent statement has confirmed the company's decision to abandon its appeal. LBRY's executives, employees, and board members have all resigned, focusing solely on meeting any remaining legal obligations.
Reflecting on the company's eight-year journey in the cryptocurrency industry, former CEO Jeremy Kauffman remarked that it might not be a happy ending, but it was undoubtedly a happy journey. LBRY's commitment to online freedom had won it both admiration and respect within the crypto community.
After LBRY shutting down, members of the crypto community offered their words of support. Some praised the company for its valiant stand against the SEC, highlighting the challenging battle it had been through. Others lauded LBRY's blockchain as one of the most practical and functional blockchain-based platforms available.
Despite LBRY Inc.'s dissolution, the LBRY blockchain itself, which is open-sourced and decentralized, will persist. It will continue to operate as long as blocks are being mined, ensuring the survival of LBRY's legacy. During the first four months of 2023, Odysee, powered by LBRY's blockchain, served 5.3 million unique users monthly, making it the most popular decentralized social media platform on the market during that period.
The impact of LBRY's demise on the future of cryptocurrency and online freedom is still uncertain. However, there are a few potential consequences that can be considered.
The Condition of LBRY holds an interesting and uncertain chapter in the narratives of cryptocurrency and online freedom. Picture this: LBRY's tussle with the SEC may cast a shadow over other crypto ventures, potentially making their token sales for fundraising more of a tightrope walk. This, in turn, could chill the exuberant spirit of innovation that has propelled countless cryptocurrency projects into existence.
The SEC's legal showdowns with giants like Ripple and Telegram are still unfolding dramas, with courtrooms as their respectable stages. The verdicts there may set the script for LBRY's impact.
In the realm of cryptocurrencies, a beacon of promise remains alight. The merits of decentralization, security, and privacy continue to lure in enthusiasts and investors, ensuring the industry's resilience.
It was a champion in decentralized social media, offering a clear contrast to the dominance of centralized platforms. In the world of decentralization, censorship struggles to find its place, and accountability stands as a guiding principle.
But the tale doesn't end with LBRY. There are other decentralized social media platforms carrying the torch, destined for a brighter spotlight in the years to come as people wake up to the advantages of decentralization.
With the cryptocurrency industry in its nascent stages, predicting the long-term repercussions of LBRY's fate remains a riddle, yet to be discovered.
Also Read - Crypto Community Celebrates SEC LBRY Security Settlement.
