The United States Securities and Exchange Commission (SEC) had some choice words for Telegram.
In a Reply Memorandum to the Southern District Court of New York, the SEC accused the encrypted messaging company of making “sleight of hand” arguments by calling Grams a commodity rather than a security.
It also said that Telegram made “strawman” defenses in saying that the “securities” its investors were supposed to receive did not “exist.”
It also, however, had this nasty nugget:
“Telegram’s attempt to avoid this economic truth by labelling Grams ‘commodities’ also fails. Grams are not commodities. Unlike gold, comic books, and Krispy Kreme donuts — commodities Telegram compares to Grams — Grams have no intrinsic value.”
The memo was the latest turn in the SEC vs Telegram saga. The SEC had accused the app maker’s 2018 token sale as illegal, alleging that the tokens – called Grams – were securities. It’s been a bitter back and forth since then, with Telegram asking the court to throw the case and the SEC successfully pushing the court to open Telegram’s bank records.
Photo: Tim Reckmann