LBRY Credits token explodes as SEC loses appeal against the company

Updated: 01 February 2023

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The cryptocurrency market is trading in the green today. However, the biggest gainer in the last 24 hours is LBRY Credits (LBC), which has pumped by 72% in the last 24 hours. The token is rallying as the company records a major win against the US Securities and exchange commission.

LBRY records a major win against the SEC

The SEC has been under criticism for regulating the cryptocurrency industry through enforcement. Therefore, the win for LBRY in its SEC case has been seen as a win for the entire sector.

On November 7, 2022, the SEC obtained a summary judgment in its favor as the sale of LBC tokens was deemed an investment contract within the six years that the token was in existence. The regulatory body hoped to use the judgment to get regulatory authority over the secondary crypto market.

LBRY Credits filed an appeal on this judgment, and Attorney John Deaton has helped the company secure a major win. Deaton acted on behalf of tech journalist Naomi Brockwell as an amicus curiae. Deaton wanted clarity on the judgment, terming the injunction as broad.

In his argument, Deaton referred to a paper written by attorney Lewis Cohen that assessed all the lawsuits in the security market since the SEC vs. W.J. Howey Co lawsuit. Neither of the lawsuits included in the Cohen paper concluded that an underlying asset was a security.

LBRY Hearing: The Stakes for ALL Crypto https://t.co/YPbrBkw0Od

— CryptoLaw (@CryptoLawUS) January 30, 2023

Deaton noted that the LBC secondary market sales should not be classified as securities by going with these previous lawsuits. The judge acknowledged the arguments made by Deaton and ruled that the order given in November last year did not apply to secondary market sales.

The crypto community has met this ruling with much optimism, given that the SEC has filed several related lawsuits against Ripple, Gemini, and Genesis. While the SEC has been called upon to offer regulatory clarity in the crypto industry, the commission has been criticized for overreaching through enforcement.

The LBRY team took to Twitter to celebrate the victory. However, they noted that they “haven’t won yet” because of the SEC’s failure to work with industry players, including centralized exchanges, to regulate the market.

Many are calling yesterday a victory for LBRY, but we haven't won yet.

It doesn't matter if the judge says $LBC is not a security if third-parties (exchanges, etc) are still too terrified of the SEC to work with it.

That's the real test.

— LBRY 🚀 (@LBRYcom) January 31, 2023

LBC pumps 72% in 24 hours

As expected, the news of this lawsuit has triggered major gains for the LBC. The token has gained by 72% in the last 24 hours, and it was trading at $0.0269 at the time of writing, according to CoinGecko.

The LBC price chart shows increased volatility as buyers accumulate the token and expect more gains. The token’s Relative Strength Index (RSI) of 62 shows that LBC is yet to reach the overbought levels, making room for more gains. In the last 24 hours, LBC has traded between $0.014 and $0.028.

LBC suffered a major blow in November after the judge ruled in favor of the SEC after classifying LBC as an investment contract. Despite the recent gains, LBC is down by 98% from its all-time high of $1.60 created in November last year. LBC’s drop last year came due to the bear market and selling pressure triggered by the SEC lawsuit.

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