Telegram is looking to postpone the launch date of its Telegram Open Network (TON) following the issues with the US Securities and Exchange Commission (SEC).
Extending the Deadline to Resolve SEC’s Lawsuit
The encrypted messaging service is planning to push back the deadline to April 30, 2020, as per the email sent by the company to its investors. Telegram cited its run-in with the SEC as the reason behind this decision.
“We had intended to launch the TON network in late October. However, the recent SEC lawsuit has made that timing unachievable,”
reads Telegram’s email to its investors.
“We disagree with the SEC’s legal position and intend to vigorously defend the lawsuit. We are proposing to extend the deadline date in order to provide additional time to resolve the SEC’s lawsuit and work with other governmental authorities in advance of the launch of the TON network.”
This additional time, the company said will help the companies working on applications for the TON network.
Intent to Profit from the Potential Increase in Grams’ Value
Initially, the launch has been scheduled for later this month on Oct. 30 but the SEC declared the $1.7 billion dollar token offering, raised by selling TON’s native token Gram to qualified investors in two separate rounds, illegal.
The SEC has used the information gathered from the US-based investors that had been conducted in secrecy.
It cited a pitch to one such US-based investor were, to attract the investor, Telegram
“spoke of its “A+ engineering team”
“chance for 0x-50x returns on the investments.”
The SEC further shared that the Grams purchased by an investor in early 2018 were off and would have “no use” at the time of launch,
“demonstrating its intent to profit from the potential increase in the value of Grams.”
Vote for your Choice
As per the letter to investors, extend the deadline, Telegram is asking for the consent of the majority token holders. The two groups, those who bought token in February 2018 and those who did in March 2018 would have to approve separately.
However, this could mean one group would agree for the extension while the other would not. In that case, it states,
“(Telegram) proposes to make certain limited amendments to the terms of the purchase agreements that remain in place to reflect the fact that fewer Grams will be issued and in circulation on the Network Launch Date.”
Investors are asked to make their decision about the deadline postponement before Oct. 23.
A court hearing in the case is scheduled for Oct. 24 in New York.