Telegram crypto halts as SEC announces emergency restraining order

Telegram crypto halts as SEC announces emergency restraining order

Telegram messenger has always been a fan-favorite among the cryptocurrency community as it meets the needs and wants of those looking for more. Telegram messenger first surfaced in 2012, released by brothers Nikolai and Pavel Durov. The messenger was intended as an alternative, niche and better option which soon became a mass success. Within their first 2 years, Telegram messenger had already gained more than 35 million registered users and they were still growing. They currently have more than 200 million users utilizing their services. Telegram messenger became so popular among the cryptocurrency community because of their active drive for innovation as their services offered benefits not yet realized. The Telegram messenger app offers users a variety of benefits above other social applications, ensuring encryption and constant improvements. In addition to privacy, telegram messenger also allows users to create group channels for an unlimited amount of members, making it the perfect place for like-minded Blockchain technology enthusiasts to meet. More so, Telegram messenger also introduced automated bots that run on a program which responds to messages or mentions, even within group chats. Telegram messenger went on to add secret chats, stickers, passport authentication and more, but their latest adoption of the future pays great homage to those who have so greatly supported and appreciated it. Telegram messenger was ready to take on Blockchain technology before the SEC stepped in.

Chaos for Telegram crypto

The company is registered in America but moves around frequently, meaning they may not have foreseen the issues to come. The Telegram crypto pre-sale saw more than $1.7 billion USD raised from less than 200 private investors, a few being US citizens. As soon as the SEC saw such a large sum of money being raised, they wanted to know more, and instead of calling the founders forward for meeting the SEC is deciding to call an emergency restraining order which halts Telegram messenger from initiating their public sale and releasing tokens. The issue doubles down when you evaluate Telegram’s whitepaper which states that all presale capital will be refunded if tokens aren’t released before the 31st of October, 2019. Because all currencies built on Blockchain technology are viewed as securities in the US, and sales of these assets require advanced registration, the SEC is calling out Telegram messenger for violations of the Securities Act. This is what the co-director of the SEC’s Division of Enforcement, Stephanie Avakian, has to say:

“Our emergency action today is intended to prevent Telegram from flooding the US markets with digital tokens that we allege were unlawfully sold.” “We allege that the defendants have failed to provide investors with information regarding Grams and Telegram’s business operations, financial condition, risk factors, and management that the securities laws require.”

What now?

As stated above, this issue will especially resonate with the Telegram crypto project as their final days draw closer, there has been no official date for the restraining order to be lifted or for the SECs issues to be addressed. With very few days left until the Telegram crypto tokens are released, there’s not much to be known about what may happen. Telegram messenger may be ready and excited to launch, but now may find themselves refunding all the capital, time and effort they put into creating their Blockchain technology project. We can only hope that these problems will be resolved, with Telegram, investors and the SEC walking away happy. But until more news becomes available, stay updated on everything else crypto by following the lower link:

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