I know this is an old article, but it gets a lot of views, so wanted to dispel this concern.
Video content for Lbry is not actually stored on the blockchain. The Lbry blockchain is largely just an interesting DNS-like system that can be used to keep track of server hosting said content and a specific address; it's effectively a torrent tracker on blockchain system.
As such, not only will someone be able to track who is actively hosting illegal content, but potentially anyone who ever hosted the content.
It's very similar to IPFS, but with a built-in way for creators to directly monetize their content. And actually, the Lbry team has hinted they'll be looking at supporting IPFS as part of the Lbrynet content-hosting backend.