Ripple, the company behind the fifth-largest cryptocurrency XRP, has scored another win in its ongoing legal battle with the U.S. Securities and Exchange Commission (SEC). The regulator has dropped all claims against Ripple CEO Brad Garlinghouse and executive chair Chris Larsen, who was accused of violating securities laws by selling XRP tokens.
The SEC filed a lawsuit against Ripple in December 2020, alleging that the firm raised over $1.3 billion through an unregistered securities offering of XRP. Ripple has denied the allegations, arguing that XRP is not a security but a digital asset that facilitates cross-border payments.
The latest development marks a significant victory for Ripple, which has been fighting to clear its name and protect its business interests. The company has also been lobbying for more clarity and innovation-friendly regulations for the crypto industry in the U.S.
LBRY Becomes the Latest Victim of the SEC
However, not all crypto projects have been as successful as Ripple in defending themselves against the SEC. LBRY, a blockchain-based file-sharing and payment network, announced on Oct. 19 that it was shutting down its operations due to debts owed to the SEC, its legal team, and a private debtor.
LBRY Inc. is winding down.
The LBRY network is unaffected.
Odysee and other assets will undergo a legal process to satisfy debts, but Odysee has a bright future ahead.
Thank you to everyone who fought with us for online freedom.
A final goodbye post is in the first reply.
— LBRY 🚀 (@LBRYcom) October 19, 2023
LBRY was sued by the SEC in March 2021 for allegedly selling unregistered securities through its native token, LBRY Credits. The firm claimed that its token was not a security but a utility that enabled users to access and publish content on its platform. LBRY also built Odysee, a decentralized video-sharing website that aimed to compete with YouTube.
Despite reaching a settlement with the SEC that reduced the penalty from $22 million to around $111,000, LBRY decided not to continue its appeal and closed its doors for good. The firm said it was unable to sustain its operations due to the legal costs and the uncertainty caused by the SEC’s actions.
The crypto community reacted with sadness and anger to the news of LBRY’s demise, calling it a case of regulatory overreach and injustice. Some also contrasted LBRY’s fate with Ripple’s success, noting the difference in their financial resources and influence. Many urged the SEC to reform its approach and foster a more supportive environment for crypto innovation in the U.S.
Whilst we celebrate another massive win for Ripple, let's not forget the damage the SEC has already done to crypto. @LBRYcom has decided not to continue its appeal against the SEC and shut its doors for good today. However, with the rampant censorship on X and… https://t.co/66tOS8L7Z7 pic.twitter.com/6hr3GL6qpi
— Ashley PROSPER (@AshleyPROSPER1) October 20, 2023