LBRY, a blockchain technology firm, announced that it is ceasing operations and will be shuttering all of its services due to insurmountable debt accrued from its expansion efforts.
The company released a statement that said it had “come to terms with reality that the future of the business would be unable to deliver the promised success.”
The statement went on to say that “the effectiveness of the fundraising efforts diminished over time while expenses mounted, requiring a need to find additional capital as the company grew” and that “the inability to generate enough funding to service debt or attract the strategic capital needed to drive the business forward ultimately led to the conclusion that the company’s resources needed to be better allocated elsewhere in order to pursue new opportunities that can bring greater returns.”
The announcement caught many in the blockchain industry by surprise as the company had made significant headway in its campaigns to be included in several major exchanges. It had also released an open source blockchain platform and appeared to be on the cusp of establishing its own blockchain-based economy.
LBRY had been funded primarily by its own investments and those of its founders, their family and friends. The firm had raised a total of $5.8 million in equity capital but was unable to find investors for a Series B fundraising round.
The closure of the company underscores the realities many blockchain firms face when attempting to scale their operations. This is unfortunately common in the blockchain industry, as startups have to compete with entrenched incumbents for capital.
However, LBRY will be remembered for its innovative approach to creating a decentralized, open source platform for digital content and its pioneering efforts in the blockchain space. The platform will remain active and its source code is open and available to others who might wish to adopt or utilize it for their own projects.