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Sale of telegram trademarks rejected by SEC

The long-awaited sale of cryptotoken from the Russian news platform Telegram has come to the wall in the form of the US Securities and Exchange Commission. The regulator has filed an emergency complaint and received a preliminary injunction for the proposed ICO of $ 1.7 billion.

Continued Review of Crypto Data

US regulators show no sign of easing their attitude towards crypto data, especially when selling new tokens. Pavel Durov, Telegram noted, hoped to introduce the Telegram Open Network as a payment option similar to the Libra.

The telegram offer has been in progress since January 201

8 and had already fallen into stormy waters in the middle of last year. The company raised funds early last year to fund the development of the new TON blockchain and its popular news service. The messaging platform reportedly wanted to pre-sell up to $ 600 million and a $ 700 million public offer.

According to the official publication, 2.9 billion grams were sold to 171 first-time investors at discounted prices. This included more than 1 billion tokens for 39 US buyers. Telegram said it will deliver the tokens before the end of this month if they could flood the market with them. The SEC had other plans.

It accused the company of not registering its token sales, which it considers securities. Stephanie Avakian, co-director of the SEC's Law Enforcement Department, said:

Today's emergency measure is designed to prevent Telegram from flooding the US markets with digital tokens that we claim have been unlawfully sold. We argue that the defendants did not provide investors with any information about the business of Grams and Telegram, the financial condition, the risk factors and the management required by securities laws.

Steven Peikin, co-director of the SEC's enforcement department, added that the regulator has repeatedly stated that issuers can not escape US securities laws by labeling their product with a cryptocurrency or a digital token.

Telegram seeks to obtain the benefits of a public offer without adhering to the long-established disclosure obligations that are intended to protect the investing public.

The company kept the blockchain secret and released code for the network only last month. Coinbase is also in the lead as it announces the Gram Token custody support after its release.

The action on Friday begins one week after the SEC has closed its one-year sale of EOS tokens with Block.one, which is also claimed to be unregistered. The company raised more than $ 4 billion, but was fined less than one percent with a $ 24 million bill. There was no need to register EOS for security.

Will the Telegram ICO resume this year? Add your thoughts below.

image via Bitcoinist Media Library

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