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ARTICLE · 25 OCTOBER 2019

SEC Halts Telegram Inc.'S Digital Token Offering

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On October 11, 2019, the United States Securities and Exchange Commission (the "SEC") filed an enforcement action and obtained a temporary restraining order against Telegram Group Inc

United StatesTechnology
M. Ridgway Barker
M. Ridgway Barker
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On October 11, 2019, the United States Securities and Exchange Commission (the “SEC”) filed an enforcement action and obtained a temporary restraining order against Telegram Group Inc. and its wholly-owned subsidiary TON Issuer Inc. (together “Telegram”), in connection with Telegram’s planned offering of billions of digital tokens called “Grams.” The SEC’s complaint alleges that the Grams are securities under the meaning of United States law, and that Telegram failed to properly register its offers and sales of Grams, as required by United State law. The complaint also alleges that Telegram has sold approximately 2.9 billion Grams at discounted prices to 171 initial purchasers worldwide since January 2018, and that Telegram was planning to launch its own blockchain no later than October 31, 2019, at which time the Grams’ initial purchasers, as well as Telegram itself, would be permitted to sell their Grams. As a result of the temporary restraining order in the

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