SEC Halts Alleged $1.7 Billion Unregistered Digital Token Offering

The us securities Exchange Commission (SEC) has achieved temporary injunction against structures of founder of Telegram Pavel Durov, who distributed among investors tokens Gram – cryptocurrency, launch of which is announced on October 31.

The SEC filed lawsuit in Manhattan District court against virgin Islands-registered Telegram Group Inc. and her” daughters ” TON Issuer Inc., which requires state to withdraw all funds raised from first investors in Gram, Commission said in release.

Since January 2018, Durov has managed to raise $ 1.7 billion from 171 investors, selling about 2.9 billion Gram tokens. In United States managed to find 39 buyers who invested 850 million dollars, according to application Telegram filed with SEC. document names Pavel Durov as “Director” of both offshore companies.

The first investors received tokens at reduced price, and after launch, they “will have opportunity to sell billions of “grams” on American market, not registered in accordance with securities legislation, SEC emphasizes.

“Our urgent measures are aimed at preventing Telegram from flooding U.S. markets with digital tokens that we believe were sold illegally,” said Stephanie Avakyan, co – head of SEC’s Executive production unit.

In lawsuit, SEC demands to impose permanent injunction on sale of Gram, to withdraw to state income funds received from illegal transactions (disgorgement), as well as ” interest for period before judgment (prejudice interest)”.

Telegram ICO should be largest in history. project aims to create digital asset that would eventually become widespread means of payment, and includes development of multi-blockchain architecture that is able to handle such volumes of transactions and provide enough speed to compete with Visa Inc. and Mastercard Inc., follows from proposal to investors.

ICO participants invested in so-called Simple future token agreement, or SAFT, which is contract giving an investor right to receive digital assets when they are listed on cryptocurrency exchanges.