SEC claims no Gram intrinsic value by comparing tokens with gold and donuts

The U.S. Securities and Exchange Commission (SEC) reiterated that the tokens of the blockchain platform Telegram Open Network (TON) are securities. The Commission called Telegram’s attempt to call them a product a desire to «avoid economic truth».

Reply Memorandum of Law in Support of Motion by ForkLog on Scribd

In a new memorandum, the SEC notes that Gram does not haveinternal value and they will never «be tangible». The Commission also emphasized that the TON project tokens are «computer code confirming the ownership of the asset»:

«Gram — not a product.Unlike gold, comic books, or Krispy Kreme donuts — products that Telegram compares with Gram — the latter has no intrinsic value. It depends only on Telegram’s efforts to create a blockchain and ecosystem», —the document says.

According to the position of the company, investors could notbuy tokens, since there were no assets at the time of the acquisition, the regulator emphasized. However, according to the SEC, in this way Telegram only creates an “artificial difference” between the purchase of Gram and their delivery:

«Telegram claims that this is somehowdoes not make Gram a security and therefore investors are not entitled to the type of information typically found in registration statements. This argument — trick».

Even if Grams were really a commodity, theywould still be considered a security, the SEC said. The reason is investors' view of tokens — buyers understand that platform tokens have the potential to bring profit with a much higher probability than goods such as oranges, the Commission noted.

The news is being supplemented.

Recall that in October last year, the SEC achievedtemporary ban on the distribution of Gram among investors. The regulator believes that the asset is a security, and accuses Telegram of violating US law in an ICO.

Recently, the SEC provided evidence that the company employees themselves considered Gram tokens as securities.