Telegram's Cryptocurrency Got A Ban From US Authorities

Recently, the U.S. Securities and Exchange Commission has issued an emergency temporary ban on Telegram, the company which is providing nearly 3 billion Gram tokens with discounted prices for over 170 initial purchasers all over the world. This action has stagnated the company’s plans for its cryptocurrencies as well as blockchain network developments. It is estimated that Telegram has obtained $ 1.7 billion through this capital raising process, and 1 over 2.9 billion Grams sold out were traced from U.S investors. 

The regulatory body mentioned that Telegram has not fulfilled its obligation to register the public offering with the agency. In addition to the fact that Grams are being considered as securities, the company allegedly violated the Securities Act of 1933. This ban will somehow affect the plans for launching Grams in the near future. According to Zachary Fallon, former SEC attorney, the ban will make international tokens business become more complicated, as well as may put the company in great trouble, especially in the circumstance that Telegram has guaranteed to their investors either to deliver tokens by 31/10/2019 or to refund their money. 

Relating to the SEC's urgent action, Stephanie Avakian, the Co-Director of SEC Division of Enforcement, mentioned that Telegram was not transparent in providing information to the investors about the business situation, financial status, risks involved and management issues required by securities law. Therefore, SEC emergency action is essential to prevent the company from illegal and massive digital tokens trading inside the country.

SEC has also emphasized that any company providing products under the guise of cryptocurrency trading or digital tokens cannot avoid being involved in federal securities laws.