Just a few days ago, the United States security and exchange commission formally took action against Telegram’s upcoming GRM token under the claim it is an illegal security. This is not the first time that the SEC is having an issue with any token being put forward by a messaging platform as Kik actually went on to sue the SEC for what they call wrongful categorization of the Kin token as they claim it is a utility token and not a security token. These two incidents have gone on to highlight just how complicated crypto regulation is and just how tricky it is to classify a security or utility token and the effects it can have on a business.
On October 12, 2019, the TON channel on Telegram announced that it will be taking a temporary hiatus following increased regulatory uncertainty. The TON channel was a private channel for investors of the Telegram Open Network.
The announcement of the hiatus was not the only development as all previous posts were deleted from the channel. Now, the announcement of the hiatus is the only post on the feed. As at press time, theo feed had 2,400 members and was created for those who are investing in the Telegram Open Network as well as for those who intend to hold the GRM token in the future.
They also stated that they are taking this time off to analyze the new information that has come to their attention as well as work through all the regulatory challenges and promised that they will be returning after these issues have probably been sorted out.
Earlier this week, the securities and exchange commission deemed that Telegram’s GRM token in 2018 was an illegal one and also filed a motion to hold all activities relating to the token which also means that investors cannot receive your tokens. The token sale had raised $1.7 billion and as such, this issue has proved to be a significant challenge for Telegram and the investors. As the company tries to work through this action by the SEC, all activities relating to GRM have been ceased.