Mati Greenspan, founder of Quantum Economics, has warned that the latest SEC action against decentralized content platform LBRY could threaten the future of all cryptocurrencies.
According to the SEC’s complaint on March 29, LBRY has allegedly offered and sold millions of unregistered securities via LBRY credit tokens since 2016. The company has disputed the SEC’s accusations because they say their tokens are focused on utility and not for speculation.
In today’s newsletter, titled “Don’t Let Them Kill Crypto,” Greenspan says if the SEC’s lawsuit against LBRY is successful, it will have dramatic consequences:
“If the court were against LBRY, it would literally call into question the future of all cryptocurrencies, including Bitcoin and Ether.”
Greenspan notes that the United States has fallen behind on crypto regulation and warns the case could set a precedent by classifying “multifaceted programmable money” as securities.
“Judges usually draw inspiration from previous rulings on similar cases, so a negative ruling here could make it easier for them to kill any project using crypto tokens. DeFi, non-fungible tokens (NFTs), smart contracts and just about everything except possibly stablecoins. “
Greenspan believes the platform’s only crime was relocating to the United States and told UKTN that the case highlights “the backward approach of the United States to innovation-driven innovation. ‘to come up”.
While the Isreal-based commentator doesn’t think an SEC victory would stifle innovation in the crypto industry as a whole, he certainly will in the United States:
“It’ll just kick him out of the United States.” Projects like this are flourishing in Europe and parts of Asia, and technology continues to advance globally. America is being left behind. ”
LBRY disputed the SEC’s case, arguing that while the “SEC claims credits are only for speculation,” credits actually allow users to tip, post, buy and to boost content on the platform, and the company “at no time indicated that LBRY Credits were an investment and consistently discouraged purchasing Credits for this purpose. ”
Greenspan urged readers of his newsletter to write a letter to Congress to show support for LBRY, or to visit helplbrysavecrypto.com. to learn more about the “stupid actions of American regulators”.
Despite the alarm bells about the negative outcome of this case, Greenspan told UKTN he was optimistic:
“Hopefully the judge will be able to see the glaring holes in the SEC case. LBRY seems to have a very strong case, so I’m pretty optimistic.