LBRY ends operations, cites feud with SEC and mounting debt
LBRY was targeted by the SEC over the issuance of its native token more than two years ago
ArtMediaWorx/Shutterstock modified by Blockworks
After a lengthy legal battle with the US Securities and Exchange Commission, LBRY has followed through with plans to close up shop.
In a farewell post, the company blamed its closure on a lost judgment to US regulators, adding it could no longer meet its financial obligations.
The development follows LBRY’s previous notice of appeal in September against a court ruling favoring the SEC, a move that was seen as a last-ditch attempt to keep the company afloat.
As a blockchain-based content-sharing platform, LBRY aimed to disrupt traditional digital publishing platforms via its decentralized protocol.
However, the firm fell under the SEC’s scrutiny for alleged securities violations concerning its LBRY Credit tokens (LBC). The company argued against classifying its token as a security.
Despite these efforts, the company was dealt a crippling blow when the court sided with the SEC following the agency’s lawsuit against it in March 2021.
Read more: LBRY files notice of appeal against court July decision that buckled the project
The regulator initially sought $22 million from the platform, though that was scaled back to just $111,000 after the SEC acknowledged its financial struggles.
LBRY’s existing debts include obligations to the SEC, its legal team and a private debtor. With no way to cover these, its assets, including its app Odysee, are being placed into receivership.
All board members, executives, and employees have resigned. The company’s domain, social media handles and GitHub repository will also be utilized to satisfy the debts, according to the post.
The LBRY network itself remains active, given its decentralized structure. Over 1.7 million identities and 30 million pieces of content have been published to the LBRY blockchain.
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