As the Telegram vs. the SEC saga continues, Telegram argued that Gram tokens are not securities and asked the court to lift the restraining order against their offering, while the SEC still insists that the offering violated the securities law.
On Oct. 16, Telegram requested the United States District Court for the Southern District of New York deny the U.S. Securities and Exchange Commission’s (SEC) emergency action and temporary restraining order against Telegram’s Gram token offering. In the filing, Telegram asked the court to maintain the status quo on selling and distributing Gram tokens. Telegram denied the SEC charges that Gram tokens are securities. According to the filing, the Grams “will merely be a currency or commodity (like gold, silver or sugar) — not a “security” — once the TON Blockchain launches.”
Telegram also insisted that they never conducted an ICO, which was also one of the SEC’s charges. The company claimed that, unlike other digital assets, Grams were not offered to the general public through Initial Coin Offering (ICO). Alternatively, Telegram “entered into private purchase agreements with a limited number of highly sophisticated purchasers.”
The SEC responded to the Telegram counterclaim and asked the court to grant a preliminary injunction or extend the temporary restraining order. According to the filing, the SEC still insists that Grams are securities under the Securities Act. The fact that Grams will be “a currency or commodity” in the future does not refer to what they were back in 2018, and cannot amend the prior violation of law.
The court hearing for the SEC against Telegram is scheduled for Oct. 24. Meanwhile, Telegram wants to move the deadline for the TON launch from Oct. 30 to Apr. 30, 2020. TON investors are requested to vote on the issue. If the holders of the majority of Gram tokens vote against the deadline extension, the purchase agreements will be terminated, and only 77% of initial investments will be returned.