Telegram has agreed to return $1.2 billion (GBP 972.84 million) to buyers and pay an $18.5 million civil penalty to resolve fees over an unregistered digital token coin providing, the US Securities and Exchange Commission (SEC) stated on Friday.
The regulator in October halted a $1.7 billion digital token providing by the agency, which is greatest recognized for its messaging app, saying Telegram had raised capital to finance its enterprise by promoting 2.9 billion “Grams” to international buyers. The SEC stated in a press release on Friday it had obtained court docket approval of the settlements with Telegram and its TON Issuer subsidiary.
Telegram neither admitted to or denied the SEC’s allegations.
The company has been looking for to crack down on the fledgling cryptocurrency business. SEC has taken the place that preliminary coin choices are securities choices and subsequently topic to SEC providing guidelines, which require firms to file registration and disclosure paperwork.
“New and innovative businesses are welcome to participate in our capital markets, but they cannot do so in violation of the registration requirements of the federal securities laws,” stated Kristina Littman, chief of the SEC Enforcement Division’s cyber unit.
Because Telegram missed a deadline to launch its TON platform due to a court docket injunction, the agency had to return funds to purchasers, Telegram stated in a press release, saying it had already returned $1.2 billion to purchasers both instantly or within the type of loans.
“We hope the regulatory environment for blockchain technology in the US becomes more favorable for others in the future,” it stated.
© Thomson Reuters 2020