SEC: Cash-Strapped Telegram Launched 2018 Token Sale to Pay for Servers

Telegram launched a 2018 token sale because it was “short on cash” to pay for servers, the U.S. Securities and Exchange Commission (SEC) said. The claim, made in the regulator’s latest document dump in its ongoing securities case against Telegram, shows for the first time the core of the SEC’s argument: that the token sale was merely a substitute for equity financing. At the time of the sale, Telegram framed it as financing for a next-generation blockchain that would be faster and more versatile than its predecessors. The documents released…

Telegram Token Sales Canceled By Liquid Exchange

Japan-based Liquid Exchange has canceled the sale of Telegram’s Gram tokens and returned funds to customers as the messaging app company remains embroiled in an SEC lawsuit. The exchange has said that it is acting in compliance with the investor agreement, which states that Telegram’s Open Network (TON) should have been launched by October 31, 2019; otherwise it must initiate the process of returning funds to investors. As a result of the longstanding lawsuit brought against the messaging app by the SEC, an injunction has been brought out to prevent…

Malaysia Looks to Tie Token Offerings to Exchanges

Following the US SEC’s investor alert against Initial Exchange Offerings (IEO’s), Malaysia’s regulator has published a regulatory guide requiring token offerings in the country be attached to exchanges. A breakdown of Malaysia IEOs A report from Malaysia’s Securities Commission (SC) makes clear that digital tokens are to be used only for goods and services and within strict guidelines, which will take effect late 2020.  Issuing digital tokens in the country without SC approval is illegal. The platforms themselves bear responsibility for vetting issuers and approving token features. The minimum paid-up…

Team Behind Foin Token Scheme Explains Catastrophic Price Drop

The Foin project — which is behind the eponymous token that sunk following its supposed unlocking period at the beginning of January — has released an official explanation of the token’s tanking after the purported price pump. Cointelegraph reported in an investigation on Dec. 30, 2019 that we had found a trail of suspicious movements in Foin’s (FOIN) price history, as well as a web of suspect business relationships associated with the coin’s development. As revealed by our investigation, there are multiple entities associated with Foin, like the Swiss-registered Foin…

Telegram Hit By New SEC Evidence Showing Token Trading After ICO

The SEC has produced new evidence in its case against Telegram, which shows that the company was engaged in trading Gram tokens several months after its initial coin offering (ICO). Messaging app Telegram has been embroiled in a lawsuit with the US Securities and Exchanges Commission, which alleges that US$1.7 billion raised from the sale of Gram tokens between January and March 2018 should have been registered with the authority because the tokens constitute a security. Telegram has consistently refuted these claims and published a statement last week to address…

SEC Seeks $16M From ICOBox for Unregistered Token Sale

The U.S. Securities and Exchange Commission (SEC) is seeking more than $16 million in penalties from ICOBox for selling “ICOS” tokens as unregistered securities. According to a filing in the United States District Court for the Central District of California, the SEC seeks a default judgment against Cayman Islands-based ICOBox and founder and CEO Nikolay Evdokimov, asking the judge to approve penalties as well as a lifetime ban from marketing or selling securities in the U.S. The regulator also wants Evdokimov to pay a separate civil penalty of just under…

MARKETS DAILY: Basketball’s First Celebrity Token Shoots for Monday Launch

After years of discussion, Monday may mark the first time accredited investors can buy tokenized shares of a high-profile professional athlete’s contract. Markets Daily is back with the latest on the NBA’s Spencer Dinwiddie story and what it could mean for entertainers of all stripes. No time to listen? Scroll down for the complete episode transcript. More ways to Listen or Subscribe: This episode featured a sound effect provided by soundsilk.com. Adam B. Levine: On today’s episode, our news roundup, the first tokenized pro basketball player, and Fidelity’s 2019 bitcoin reflections.…

US SEC Seeks $16 Million Penalty from Token Sales Platform Operator

The United States Securities Exchange Commission (SEC) is seeking a default judgement against token sale platform ICOBox and its founder Nikolay Evdokimov. Documents filed with the Central District Court of California on Jan. 9 order the defendants to pay over $16 million in disgorgement to the agency within 14 days of the judgement’s entry.  In a complaint filed on Sept. 18, 2019, the SEC had sued ICOBox and Evdokimov for operating an unregistered securities offering of roughly $14.6 million worth of digital assets in 2017, and operating as an unregistered…

Kik (Again) Asks for Trial in Legal Tussle With SEC Over Token Sale

Kik is hoping to go to trial against U.S. Securities and Exchange Commission (SEC) allegations that the company conducted an unregistered securities offering with its 2017 kin token sale. The SEC filed a status update on the legal battle Thursday, providing a tentative schedule for the proceedings and detailing the parties’ plans for scheduling some remaining depositions. “Kik requests that the Court set a trial date. The SEC takes no position on whether setting a trial date would be helpful at this stage and submits that the matter can and…

Tom Shaughnessy and Jordan Clifford on Layer 1 Wars, Token Economics and a Shift to Applications

Tom Shaughnessy is a co-founder of Delphi Digital as well as the host of the Chain Reaction podcast. Jordan Clifford is managing director of Scalar Capital. In this end of year interview for The Breakdown, Tom argues that the big story of 2019 was actually the fact that it was all about “quiet” building. When it comes to 2020, however, watch out for fireworks. Tom predicts we’ll see a major increase in the Layer 1 smart contract platform wars, as well as growth in the perceived importance of token economic…