Telegram has become the latest messaging platform to find themselves in hot water with the SEC over the issue of a token they claim is not a security but which was classified as one by the SEC themselves. Another messaging platform in the same situation is Kik, who have gone on to close down their messaging platform as a result of the SEC’s categorization of the Kin token. The SEC deemed Telegram’s GRM token an illegal security and filed a motion on October 11, 2019, to halt all action regarding the token and as a response to this, Telegram has had to halt activities and focus their attention on the court case.
Telegram is fighting back as they filed on October 16, 2019, asking for the United States District Court for the Southern District of New York to deny the Securities and Exchange Commission’s request for a restraining order against them to block their activities regarding the GRM token.
This filing was made two days before October 18, 2019, which is the deadline for Telegram to make a counter claim in court. This new claim also asks the court to release an order that allows them to continue with the status quo and resume the business activities regarding the GRM token.
It also accuses the SEC of deliberately creating a false emergency situation by filing on October 11, 2019 knowing fully well that Telegram had promised to reimburse investors if the did not launch by October 31, 2019. They also made reference to the fact that they had been communicating with their commission for 18 months and had asked for more information regarding the categorization of the token but received no response only to be slapped with an emergency filing.
“Despite the SEC knowing for 18 months that if the TON Blockchain did not launch by October 31, 2019, Telegram would be obligated under its agreements with private purchasers to return the funds it raised, the SEC (i) never requested that Telegram delay the launch of the TON Blockchain; (ii) never advised Telegram of its intention to seek injunctive relief; and (iii) waited until the eleventh hour to file an ex parte application to enjoin Telegram’s launch,” the document says.