Telegram found itself in hot water with the SEC over the last week as they filed a restraining order as well as a motion against them in a Manhattan District Court and claimed that the GRM token was an illegal security. After this announcement was made, Telegram was forced to close down a Telegram Open Network channel for investors and as of now, their future is a bit uncertain even as court proceedings are moving ahead. This issue has been one of the latest between the SEC and token issuers as the definitions of securities tokens and utility tokens are still floating in the air.
Now, Telegram has made some effort to clear the air by sending out an official letter to investors of the Telegram Open Network to explain their position as well as what will happen moving forward.
See You in Court
According to the letter, Telegram has been trying to solicit feedback from the United States Security and Exchange Commission for over 18 months and they did not receive the feedback this sought and were surprised by the lawsuit and disagree on its position.
“We were surprised and disappointed that the SEC chose to file the lawsuit under these circumstances, and we disagree with the SEC’s legal position,” the report says.
For now, Telegram is looking into the best route forward for all parties involved and are considering a possible delay of the launch date. In the meantime, the court hearing has been scheduled for October 24, 2019, during which they will have a chance to present their side of the story to court.
In the past, the SEC has been criticized for not giving clarity on cryptocurrency and ICO-related matters and instead, taking swift action against various firms. Most notable instances in which Kik’s token was deemed an illegal security offering and this has led to Kik suing the SEC and having to shut down their messaging platform. Even with all these instances, many firms are nowhere closer to knowing just exactly how the various tokens will be classified.