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Eleanor Terrett, a Fox Business correspondent, has opined regarding the ongoing LBRY-SEC lawsuit that if the judge rules that secondary market transactions of LBC by people unaffiliated with or having no investment intent in LBRY are legal, it might set a precedent that would be favorable toward XRP users.
If the judge rules that secondary market transactions of $LBC by people unaffiliated with/have no investment intent in @LBRYcom are legal, it could set a precedent that would be favorable toward $XRP users. https://t.co/qGVydrXmAm
— Eleanor Terrett (@EleanorTerrett) January 30, 2023
Jan. 30 is a date to remember as cryptocurrency start-up LBRY had its last hearing. According to Attorney Jeremy Hogan, who shared the first word he received from the hearing, the SEC admitted on the record that the LBC token itself is not a security.
This implies that many (if not most) LBC token holders did not view LBC as an investment and that they utilized the token for purposes of consuming.
If this happens, there's a very strong chance the SEC will rush towards settlement with Ripple.@freddyriz @JohnEDeaton1 @attorneyjeremy1 @Belisarius2020 @FilanLaw https://t.co/4RxNfUpkhA
— Yassin Mobarak (@Dizer_YM) January 30, 2023
As reported earlier, LBRY lost to the SEC in the summary judgment as the judge ruled that the initial sales of LBC were security offerings. The Jan. 30 hearing was on "whether or not the token itself is a security," a user chipped in.
Likewise, LBRY sought clarity on secondary market transactions and those of users of the platform.
Tomiwabold OlajideAccording to John Deaton, who filed an amicus brief and made an appearance at the hearing, "the relevant question at any given time is whether the LBC token is being sold in an investment contract transaction; is the 'seller' at the time of the sale inducing the buyer to purchase from her by making undertakings to the buyer about the profit potential of the asset?"
The SEC was seeking a permanent injunction that does not distinguish between LBRY, its executives and users of the platform or secondary market transactions. Clarity on secondary market transactions might be favorable for the Ripple lawsuit and the general cryptocurrency market.
"Based on the SEC's argument regarding what constitutes the common enterprise in the Ripple case, there's a possibility Judge Torres could deny both summary judgment motions and the case go to a jury," John Deaton said in earlier tweets.
Alex Dovbnya
Dan Burgin
Vladislav Sopov