Telegram’s Clash With SEC Continues: Internal Correspondance Suggests TON Is Security
The critical situation between Telegram and the U.S. Securities and Exchange Commission (SEC) took another step forward. The market regulator now claims that the popular messaging company saw its upcoming Gram token as securities and thus should fall under established regulations.
Is Gram Token A Security?
Telegram’s controversy regarding its TON blockchain and its native cryptocurrency, Gram, continues. The SEC has recently filed another claim with the court in the Southern District of New York.
This time, the market regulator indicates that Pavel Durov’s company knew that Gram Token will be a security. As such, it needs to fall under already established regulations, since security tokens are tradable financial assets that require personal identifications.
In the new documentation delivered to the U.S. court, one particular email raises awareness. It was purportedly sent to an investor’s accountant on March 6th, 2019. А Telegram official, Shyam Parekh, has reportedly written that the investor had the right to 72,835,916.68 Grams and that “the Fund has clear title to such securities.” Further down in the same email, it also notes that “the securities are not pledged.”
After Telegram raised $1.7 billion with its token sale in 2018, SEC considered it illegal since Gram has no prior registration in any jurisdiction. The commission requested access to the financial records of the company, which was initially declined.
However, the court later decided that Telegram has to disclose all banking details regarding the token sale, the TON blockchain, and the Gram token. The firm has until February 26th, 2020, to provide the information.
Liquid Cancels Gram Sale
One of the consequences of Telegram’s legal issues with SEC came from the Japanese cryptocurrency exchange, Liquid. The latter initially carried out a Gram Token Sale in July 2019. Back then, it was anticipated that TON’s mainnet network will launch before the end of October 2019.
With the following delay and still unknown actual release date, Liquid canceled the sale and will refund all investors who participated in it.
“The Gram Token Sale on Liquid has been canceled, and all funds previously held in escrow by Liquid have been returned to Liquid users who participated in the Gram Token Sale.
Under the Gram Token Sale Terms of Sale, Liquid is required to return all funds committed by Liquid users in the Gram Token Sale due to the fact that the TON mainnet was not launched by 30 November 2019.”
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