Telegram’s regulatory tussle with the US Securities and Exchange Commission(SEC) has finally come to an end.
The two settled the matter in court with the Private messaging platform agreeing to pay the watchdog $18.5M in fines. The court settlement puts an end to the six-month long conflict between Telegram and the commission.
In addition, Telegram will pay “a $1.22 billion disgorgement that is offset by $1.19 billion paid as ‘termination amounts’ in investors’ purchase agreements and the amounts that some investors loaned to Telegram earlier this year,” reports CoinDesk.
The platform has been given up to 30 days to pay the SEC penalty and up to four years to compensate TON’s investors.
In a move to limit the platform from making such mistakes again, the telegram must notify the commission first if it plans to offer “‘cryptocurrencies,’ ‘digital coins,’ ‘digital tokens,’ or any similar digital asset issued or transferred using distributed ledger technology” in the next three years. The notice should be provided 45 days before the issuance date.
Telegram’s TON blockchain project dates back to 2017. The company managed to raise $1.7 billion to fund the project’s development. Regulatory tussles began in October last year when SEC sued the company terming the Token project as unlawful.
Despite showing resilience at first, Telegram finally decided to give up on TON. On May 27, Telegram’s Russian-born Founder Parel Durov announced that they are abandoning the project. “Today is a sad day for us here at Telegram. We are announcing the discontinuation of our blockchain project. Below is a summary of what it was and why we had to abandon it,” he wrote in a blog post.