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The SEC’s victory in this lawsuit is a huge blow to Ripple and the XRP cryptocurrency.
US Securities and Exchange Commission defeated Peer-to-peer content delivery network LBRY.
The United States District Court for the District of New Hampshire ruled that LBRY offered the LBRY Credit (LBC) token as an unregistered security.
LBRY murmured As a response to the judgment.
The SEC sued the decentralized content platform for selling unregistered securities in May 2021, just months after filing a similar lawsuit against blockchain company Ripple.
LBRY argued that LBC had utility and that some buyers intended to use the token instead of holding it as an investment. Federal Judge Paul Barbadoro dismissed the claim. There is nothing in the case law to suggest that a token with both consumptive and speculative uses cannot be sold as an investment contracthence the LBC purchase of LBC for use on the LBRY blockchain. Statements from a subset of owners are of limited relevance to determine whether LBRY provided it as collateral,” the judge said. “While some purchasers may have acquired LBC for consumer purchases, this establishes that the objective economic reality of LBRY’s provision of LBC was providing it as security. It doesn’t change the fact that we do,” he added.
The LBRY case has been closely followed by lawyers because it could be a landmark case. June, LBRY was suggested This incident will have implications for Ripple and the entire cryptocurrency industry.
The agency’s victory could have serious repercussions in the Ripple case, as the SEC will use the ruling to strengthen its position. The SEC believes Ripple sold his XRP token as an unregistered security.
Ripple friendly lawyer Jeremy Hogan Claim LBRY’s case is likely to be included in the SEC’s final opinion.
Ripple’s lawsuit is expected to close in the first half of 2023.
