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<p class="is-style-lead">Hester Peirce has expressed concern over the SEC’s approach towards crypto enforcement, explicitly referencing the recent LBRY case.</p>
<p>Commissioner Hester Peirce of the Securities and Exchange Commission (SEC) on Oct. 27 shared her thoughts about the agency’s treatment of blockchain-based file sharing and payment network <a href="https://crypto.news/lbry-announced-closure-due-to-debts-to-sec/" data-type="link" data-id="https://crypto.news/lbry-announced-closure-due-to-debts-to-sec/" rel="noopener noreferrer nofollow">LBRY</a>.&nbsp;</p>
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   <p lang="en" dir="ltr">Some overdue thoughts on our case against LBRY: <a href="https://t.co/wLsG4Xr7wz" target="_blank" rel="noopener noreferrer nofollow">https://t.co/wLsG4Xr7wz</a></p>— Hester Peirce (@HesterPeirce) <a href="https://twitter.com/HesterPeirce/status/1717965338489352613?ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">October 27, 2023</a>
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<p>In her <a href="https://www.sec.gov/news/statement/peirce-statement-lbry-102723" target="_blank" rel="noopener noreferrer nofollow">statement</a>, Peirce highlighted that LBRY had been singled out by the SEC despite it having a functioning blockchain with a real-world application. She decried the Commission’s role in the demise of LBRY following the company’s shutdown after failing to <a href="https://news.bloomberglaw.com/litigation/lbry-winding-down-drops-appeal-of-crypto-ruling-favoring-sec" data-type="link" data-id="https://news.bloomberglaw.com/litigation/lbry-winding-down-drops-appeal-of-crypto-ruling-favoring-sec" target="_blank" rel="noopener noreferrer nofollow">appeal</a> the court decision that went against it.</p>
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 <p>“Are investors and the market really better off now after the Commission’s litigation contributed to the demise of a company that had built a functioning blockchain with a real-world application running on top of it?”</p> <cite>Hester Peirce, SEC Commissioner</cite>
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<p>The <a href="https://www.ft.com/content/febdabfb-e453-4502-8ef8-9cfa03b90d98" target="_blank" rel="noopener noreferrer nofollow">commissioner</a> said the SEC was misaligned with its “misguided <a href="https://crypto.news/u-s-sec-commissioner-hester-peirce-speaks-out-against-stringent-cryptocurrency-regulations/" target="_blank" rel="noopener noreferrer nofollow">enforcement-driven</a> approach to crypto.” She also condemned the regulator for not having a clear path mapped out for companies like LBRY to be able to register functional token offerings.</p>
<p>She argued that the SEC could have used the time and resources spent on the LBRY <a href="https://crypto.news/sec-wins-lbry-loses-as-lbc-token-ruled-as-a-security/" target="_blank" rel="noopener noreferrer nofollow">case</a> to create clear regulations that would benefit the crypto sector instead of this blind blame game.</p>
<p>You might also like: <a href="https://crypto.news/lbry-announced-closure-due-to-debts-to-sec/" rel="noopener noreferrer nofollow"> LBRY announced closure due to debts to SEC </a></p>
<p>Columbia Business School professor Austin Campell echoed Commissioner Pearce’s sentiments and described the SEC’s conduct in the LBRY case as “wildly egregious” and a “national scandal.”</p>
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   <p lang="en" dir="ltr">The LBRY settlement is a picture-perfect example of how not to regulate, and should be considered a national scandal.<br><br>With <a href="https://twitter.com/HesterPeirce?ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">@HesterPeirce</a>'s statement today, I feel that I should finally weigh in on this one, to make clear just how wildly egregious the conduct of the SEC was in…</p>— Austin Campbell (@CampbellJAustin) <a href="https://twitter.com/CampbellJAustin/status/1717986659533230343?ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">October 27, 2023</a>
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<p>According to him, the SEC had a problem with how LBRY rolled out its native token. The company didn’t register it as a security. The Commission took punitive measures and demanded $44 million in fines, which Campbell felt was odd because there were no allegations or evidence of fraud.</p>
<p>Eventually, the court approved the fine but <a href="https://crypto.news/sec-revises-22m-penalty-against-lbry-proposes-111k-instead/" target="_blank" rel="noopener noreferrer nofollow">reduced</a> it to $111,614. By then, it was too late. The damage was already done, and LBRY went <a href="https://www.theguardian.com/technology/2023/jul/16/lbry-closes-odysee-cryptocurrency-tech-sec-fraud-extremist" target="_blank" rel="noopener noreferrer nofollow">bankrupt</a> soon after.</p>
<p>Campbell went on to strongly advocate for a complete overhaul of the SEC’s leadership to allow rules more accommodating to innovations like blockchains rather than hindering them with what he considers outdated regulations.</p>
<p>Read more: <a href="https://crypto.news/ripple-lawsuit-could-be-impacted-by-lbry-lawsuit-experts-suggest/" rel="noopener noreferrer nofollow"> Ripple lawsuit could be impacted by LBRY lawsuit, experts suggest </a></p>

Hester Peirce questions SEC enforcement action against LBRY

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