According to court files on Friday, the U.S. Securities and Exchange Commission wants to reduce a $22million penalty imposed by the SEC against crypto startup LBRY down to $111 614.

The regulator cited LBRY’s “lack of funding and near-defunct” status as reasons for withdrawing the previous request for a fine.

The SEC filed a lawsuit against LBRY in March of last year on the grounds that the sale its native LBRY credit (LBC) was in violation of federal securities laws. A New Hampshire judge found that the startup violated federal securities laws when it failed to register with SEC.

Jeremy Kauffman LBRY founder said that this case may have an impact on the crypto industry in general, as the company maintains that LBC is not a security. Ripple Labs is using a similar defence as it faces SEC allegations for the sale $1.3 billion worth of XRP tokens.

In its request for a remedy, the SEC also argued that LBRY be “enjoined” until it carries through with plans to dissolve the business and burn LBC tokens. The company argued that the SEC’s penalty of $22 million was unwarranted. It compared the amount to the regulator’s settlement for $5 million over its case against Kik regarding a $100-million unregistered token sales.

Read more: LBRY Token rally stalls as traders move on from court speculation

Parikshit Miishra is the editor.