Telegram has said, that it might have to postpone the October 31 date for the launch of its cryptocurrency Gram. It comes after the US Securities and Exchange Commission (SEC) filed a lawsuit against it and its wholly-owned subsidiary TON User for illegal ICO and also secured an emergency restraining order on sale of its cryptocurrency gram tokens to US investors.
Between January and March of 2018, Telegram sold 2.9 billion gram tokens for $1.7 billion to 171 investors. Out of the $1.7 billion, about $424.5 million was invested by 39 investors from the US.
The SEC maintains that as the Gram had no value at the time of the ICO and no products and services could be bought by using it, Gram resembles security more than a token. Thus, its sale should be seen as a sale of securities. Further, the SEC requires that all securities be registered with it. As Gram has not registered with it, its sale is illegal.
Secrecy has surrounded Gram ever since its launch, with investors being specifically asked to refrain from talking about their investment.
Telegram has come under a cloud after reports that hackers were using the service to loot cryptocurrency from digital wallets.
The SEC maintains that Telegram aims to flood American markets with billions of grams that do not represent any value. No ecosystem of products and services for which it can be used. No system for trading it for other cryptocurrencies or fiat currency. Hence, the SEC’s restraint order.
The SEC further held that a large number of tokens issued could not have any tangible use for the gram ecosystem. Also, the gram token is limited at present to only large investors, but if it becomes operational on October 31, millions of smaller investors will be exposed to it. Thus, it’s through scrutiny as security becomes very important to protect those small investors.
In a statement, Telegram has said,
We were surprised and disappointed that the SEC chose to file the lawsuit under these circumstances.
