The Securities and Exchange Commission (SEC) has recently dropped a $22 million penalty against LBRY to only $111,614. The SEC initially filed a civil suit in March 2021 against the company for illegal unregistered offerings of cryptocurrency securities. The ruling by the SEC stated that these offerings are considered as securities, and LBRY was liable to pay the penalty of $22 million.

However, in December, the firm argued that the SEC's fine was too high and did not account for their legitimate business expenses. Following this, the SEC has reconsidered their original decision and reduced the charge to $111,614. In the court filing, the regulator acknowledges that these financial resources are not available to LBRY and also alluded to the fact that the company is soon to cease operations due to the staggering legal expenses.

This decision serves as another example of the SEC implementing their more flexible approach towards the cryptocurrency industry. With the implementation of Regulation A+, they have made it easier for companies to raise funds through token offerings. The SEC have also indicated their commitment to promote innovation while protecting consumers and the market by creating a clearer and more robust legal framework.

This penalty being lowered can serve as a sign to other companies in the industry that the SEC is open to reasonable negotiations, and to also teach these firms the lesson to take more precautions in their financial operations. While the $111,614 price tag is still high for LBRY, it is a much lower amount than it could have been, and serves as a warning to other firms to pay attention to the rules when engaging in cryptocurrency offerings or transactions.



Other News from Today