Telegram Dodge a Bullet as US Court Declined SEC’s Motion for Them to Disclose Bank Records
On January 6th, 2020, the US District Court for the Southern District of New York issued an order to dismiss SEC’s court order seeking to compel Telegram to explain how funds generated from an Initial Coin Offering (ICO) have been spent.
This year started on the wrong foot for Telegram, as the SEC requested the firm’s financial records to explain what it did with the $1.7 billion raised for the TON blockchain.
Telegram refused to comply with the request, leading the SEC to go to court demanding that the Telegram be compelled to disclose the bank records concerning how they have spent the funds they raised from investors in the past two years and to answer questions about the disposition of investor funds.
The US financial regulator claims that the ICO, launched in 2018 for the expansion of the TON project, was an unlawful and unregistered coin offering.
Telegram now appears to have caught a break with the recent case against them, as a US court dismissed the request. Despite this, Telegram would still need to prove that the banking records comply with existing foreign laws.
Telegram Pushes on with Plans for its Blockchain Network
In a post on Monday, which appears to be the first official notice addressing the TON blockchain project, the Telegram team revealed that it would not integrate a crypto wallet into its messaging app. At least until they get permission from all relevant US regulators.
The post was mainly meant to quell emerging rumors surrounding its TON blockchain and the future Grams cryptocurrency. The main topic brought up in the announcement was explicitly targeting laws and regulations, claiming that the company is working to ensure that all requirements are met before the product is launched.
Even though TON will not be integrated with the popular Telegram messenger service, the company doesn’t rule this out entirely.
The company leaves the door open for possible integration in the future to the extent permitted under applicable laws and governmental authorities.
Crypto community warned of Possible Scams
In what appears to be Telegram’s effort to garner support from the crypto community, the company also addressed their past lack of comment on the TON project, explaining that telegram “has been careful not to speak publicly” about the project.
The company also confirmed that the GRAM token is currently being tested and is not available for purchase yet, so the crypto community should steer clear from any possible scams containing a similar name.
A Public Notice About the TON Blockchain and Grams
You may have heard that since 2017 the team at Telegram has been developing a new blockchain platform called the TON Blockchain and native cryptocurrency called Grams. We hope that as a result of this project Grams will become a true complement to traditional currencies, improving the speed, efficiency and security of everyday commercial transactions globally. We believe that the TON Blockchain technology will create a stable ecosystem and represents a significant improvement upon previous platforms in terms of speed, usability and scalability.
There have been a lot of rumors in the media and speculation about the details of this project. Telegram has been careful not to speak publicly about these rumors while we continue to build the TON Blockchain platform and work out the exact details of the project to ensure that the TON Blockchain and Grams can operate in a way that is compliant with all relevant laws and regulations.
In light of recent events, we wanted to take the time to publicly clarify certain aspects of the TON Blockchain and Grams as we continue to prepare for a successful launch of the project.
We’ve included short summaries in simple terms for paragraphs in this text, formatted like this
First, it has come to our attention that certain websites appear to be offering Grams to the public. These websites sometimes refer to the offers as “token presales,” and some pretend to be affiliated with Telegram. As we’ve warned you on numerous occasions, these are NOT official Telegram websites, they have NO affiliation with Telegram, and NO Grams have been issued yet to anyone. Neither Telegram nor any of its affiliates are involved in any public sales or presales of Grams. To the contrary, the TON Blockchain on which Grams will function is still in a Beta Test phase and you can access the Beta Test website at https://test.ton.org/download.html. Only once the TON Blockchain launches will Grams be created and available to purchase.
TLDR: Grams don’t exist yet, nobody can buy or sell them before we announce the launch of TON Blockchain. Don’t get scammed.
Second, if you are considering whether to purchase Grams once the TON Blockchain platform is launched, we want you to know certain things. Telegram and its affiliates have not made any promises or commitments to develop any applications or features for the TON Blockchain or otherwise contribute in any way to the TON Blockchain platform after it launches. In fact, it is possible that Telegram may never do so. Rather, it is Telegram’s goal and hope that the decentralized community of third-party developers and others will contribute to the TON ecosystem through the development of applications and smart contracts. It will be the sole responsibility of third parties and the community to adopt and implement such applications or smart contracts on the TON Blockchain in the manner they choose. Telegram does not, and cannot, guarantee that anyone will adopt or implement such features or provide such services, on any given timetable or at all.
TLDR: We are creating a decentralized platform for everyone. Once it launches, Telegram won‘t be obligated to maintain the platform or create any apps for it. It’s possible we never will.
The code for the TON Blockchain will always be open source and publicly viewable. Once it is launched, Telegram will occupy the same position as any other party with respect to the TON Blockchain and will not have any control over, any unique rights within, or any responsibility for the management of, the TON Blockchain.
Telegram or its employees may, but do not commit to, hold any Grams following the launch of the TON Blockchain. To the extent they do, they will not take part in voting or validating in connection with the TON Blockchain. This voluntary decision was made in order to avoid any perception that Telegram or its employees can or will exercise control over the TON Blockchain following its launch.
TLDR: Telegram won‘t be able to control the blockchain and the ecosystem after it launches. Pretty much like an architect who designed a skyscraper can’t control what happens with the building after it’s finished – including what gets built around, inside or on top of it.
Third, you should NOT expect any profits based on your purchase or holding of Grams, and Telegram makes no promises that you will make any profits. Grams are intended to act as a medium of exchange between users in the TON ecosystem. Grams are NOT investment products and there should be NO expectation of future profit or gain from the purchase, sale or holding of Grams.
Grams do NOT represent:
- Any equity or other ownership interest in Telegram or its affiliates
- Any rights to dividends or other distribution rights from Telegram or its affiliates
- Any governance rights in Telegram or its affiliates.
TLDR: If you buy grams at some point in the future, this won’t mean you “own a piece of Telegram.” Grams don‘t give their holders any special rights, just like owning Euros doesn’t give you shares in the European Union.
In deciding whether to purchase Grams, you should be fully aware of the risk that Grams may decrease in value over time or even lose all monetary value. There are a number of risks related to purchasing cryptocurrencies like Grams, including volatility in cryptocurrency markets, the possibility of increasing regulation of cryptocurrency exchanges and other risks.
TLDR: Dealing with cryptocurrency is risky and can actually make you poorer than you are due to a boatload of external factors.
Finally, we wanted to provide further clarity regarding some technical and governance aspects of the TON Blockchain. Please note that the below is intended to supersede and replace all prior materials or communications regarding the TON Blockchain and Grams to the extent of any conflict or potential conflict, including the information and details set forth in the TON Whitepapers or any previous communications or materials by Telegram or anyone else:
(1) Telegram is under no obligation, and makes no promise or commitment, to ever establish a TON Foundation or similar entity in the future.
(2) At the time of the anticipated launch of the TON Blockchain, Telegram’s TON Wallet application is expected to be made available solely on a stand-alone basis and will not be integrated with the Telegram Messenger service. In this regard, the TON Wallet is expected to compete with any other wallet applications designed and offered by third parties. Telegram may integrate the TON Wallet application with the Telegram Messenger service in the future to the extent permitted under applicable laws and governmental authorities.
Telegram reserves all rights to further add to, clarify or revise these or any other aspects of the TON Blockchain or Grams. We look forward to providing more information as we get closer to the anticipated launch of the TON Blockchain.
January 6, 2020
The Telegram Team
(This communication contains forward-looking statements, including statements of plans, objectives, expectations, development status and intentions. Any number of factors could cause actual results to differ materially from those contemplated by any forward-looking statements, including but not limited to the risks identified herein.)
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