The United States Securities and Exchange Commission (SEC) has halted Telegram’s planned GRAM (GRM) token expected to launch later this month.
In an official notice on Oct.11, the Sec filed an emergency order retraining the messaging company and its Telegram Open Network (TON) from going ahead with its proposed digital token offering.
The US SEC says Telegram and TON have not registered their sale of GRM tokens under the SEC’s Securities Act of 1933. Hence the project attempts to sell an ‘unregistered digital token’. The commission states:
“Our emergency action today is intended to prevent telegram from flooding the U.S markets with digital tokens that we allege were unlawfully sold.”
This suspension is part of the SEC’s resolve to ensure proper registration and regulation of token offerings, as well as curtail possible cases of violations of cryptocurrency safety acts or illicit financing.
Initial reports had suggested that telegram had managed to skip the scrutiny encountered by Facebook’s coin. However, this latest order will have the project take a pause.
Telegram had planned to issue GRAM tokens to promote possible buy and sell of goods on Telegram, with its TON Blockchain (Telegram Open Network) serving as host for digital applications.