1233
3730
$247,062,081,547
$14,093,246,904
66%
The Securities And Exchange Commission Calls For “Emergency Actions”

Telegram’s GRAM coin offering may be considered as the largest ICO in history, but regulators halted the $1,7 billion worth project. The reason – “conducting an alleged unregistered, ongoing digital token offering in the U.S. and overseas,” according to the SEC. 

Telegram and its subsidiary TON network planned to distribute the tokens on October 31st, but SEC’s “emergency actions” had led to the regulator issuing a temporary restraint order against Telegram and TON, accusing them of not registering their tokens as securities, and violating the Securities Act of 1933.

SEC’s co-director of the enforcement division, Stephanie Avakian, spoke about the accusations, claiming that “the emergency actions are needed to prevent Telegram from flooding the U.S. market with unregistered, unlawfully sold securities.” Avakian also stated that Telegram did not provide the required by law information about business operations, risk management and financial conditions. Telegram officials are yet to present their point of view.

Telegram’s ICO managed to sell 2,9 billion Gram tokens to 171 investors, including the most prominent Silicon Valley giants Kleiner Perkins Caufield & Byers, and Benchmark. 1 billion Gram tokens are in “the hands” of U.S. citizen. 

The crackdown of Telegram and TON comes amid five companies leaving Facebook’s Libra project due to regulatory scrutiny from both U.S. and European regulators. However, Telegram officials declared that Grams are a part of a much bigger project – the Telegram Open Network, which would be used as a medium for app development and money transfer.

The saga between Telegram and the SEC is nowhere near conclusion, as Telegram’s owner Pavel Durov, alongside two Telegram employees, must testify in court on the SEC vs. Telegram lawsuit. Durov must testify on January 7-8 in London.

Immediately after the halt, Telegram proposed to postpone the token distribution to April 2020, with investors` agreement. It is still unclear how long the lawsuit would take, but chances are the situation with Block One to be seen yet again. Block.One, the company behind the EOS token, was also under SEC’s crosshairs, as EOS was charged with a fine of $24 million for issuing an unregistered ICO.

ICO news SEC ICO token tokens digital SEC Regulation Regulations Telegram Gram

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